10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

R	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Quarterly Period Ended October 31, 2011
£	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from __________ to __________

Commission File Number: 000-54419

CORNERWORLD CORPORATION

(Exact name of registrant as specified in its charter)

Nevada	98-0441869
(State of incorporation)	(I.R.S. Employer Identification No.)

13101 Preston Road, Suite 100

Dallas, Texas 75240

(Address of principal executive offices)

(888) 837-3910

(Registrant’s telephone number including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes   X    No ___

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ___     Accelerated filer ___     Non-accelerated filer ___     Smaller reporting company   X  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ___  No   X  

The number of shares outstanding of the registrant’s common stock, $0.001 par value per share, as of December 15, 2011 was 147,547,607.

CORNERWORLD CORPORATION

INDEX

Item Number		Page
	PART I. FINANCIAL INFORMATION
1	Financial Statements (Unaudited):		1
	Condensed Consolidated Balance Sheets as of October 31, 2011 and April 30, 2011		1
	Condensed Consolidated Statements of Operations for the Three and Six Month Periods Ended October 31, 2011 and 2010		2
	Condensed Consolidated Statement of Stockholders’ Deficit for the Six Months Ended October 31, 2011		3
	Condensed Consolidated Statements of Cash Flows for the Six Month Periods Ended October 31, 2011 and 2010		4
	Notes to Condensed Consolidated Financial Statements		5
2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
3	Quantitative and Qualitative Disclosure about Market Risk		21
4	Controls and Procedures		21
	PART II. OTHER INFORMATION
1	Legal Proceedings		21
1A	Risk Factors		21
2	Unregistered Sales of Equity Securities and Use of Proceeds		22
3	Defaults Upon Senior Securities		22
4	[Removed and Reserved]		22
5	Other Information		22
6	Exhibits		22
	Signatures		23

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

CornerWorld Corporation

Condensed Consolidated Balance Sheets

	October 31, 2011			April 30, 2011
	(unaudited)			(audited)
Assets
Current assets:
Cash	$	580,347		$	934,250
Accounts receivable (net of allowance for doubtful accounts of $94,516 and $48,936 at October 31, 2011 and April 30, 2011, respectively)		2,053,233			1,777,704
Prepaid expenses and other current assets		93,772			112,972
Total current assets		2,727,352			2,824,926
Property and equipment, net		281,499			478,536
Goodwill		2,136,836			2,136,836
Patent		6,750,584			7,529,498
Intangibles, net		—			111,104
Other assets		28,410			28,132
TOTAL ASSETS	$	11,924,681		$	13,109,032
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	2,216,295		$	2,962,995
Accrued expenses		769,013			600,726
Notes payable, current portion, net of unamortized discount of $326,523 and  $316,516 at October 31, 2011 and April 30, 2011, respectively		558,793			543,484
Notes payable related parties, current portion, net of unamortized discount of $326,984 and  $402,824 at October 31, 2011 and April 30, 2011, respectively		1,102,189			1,444,145
Deferred revenue		700,589			460,415
Total current liabilities		5,346,879			6,011,765
Long-term liabilities:
Notes payable, net of current portion, net of unamortized discount of $703,901 and  $880,916 at October 31, 2011 and April 30, 2011, respectively		4,986,099			5,059,084
Notes payable related parties, net of current portion, net of unamortized discount of $53,613 and  $280,149 at October 31, 2011 and April 30, 2011, respectively		2,548,286			2,134,254
Other liabilities		700,563			642,899
Total liabilities		13,581,827			13,848,002
Commitments and Contingencies
Stockholders’ deficit:
Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding		—			—
Common stock, $0.001 par value, 250,000,000 shares authorized; 147, 547,607 and 146,972,901 shares issued and outstanding, at October 31, 2011 and April 30, 2011		147,547			146,972
Additional paid-in capital		10,081,102			10,006,785
Retained earnings (accumulated deficit)		(11,885,795	)		(10,892,727	)
Total stockholders’ deficit		(1,657,146	)		(738,970	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	11,924,681		$	13,109,032

See Notes to Condensed Consolidated Financial Statements.

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CornerWorld Corporation

Condensed Consolidated Statements of Operations

(unaudited)

	For the Three Months Ended October 31,						For the Six Months Ended October 31,
	2011			2010			2011			2010
Sales, net	$	2,914,058		$	2,950,294		$	5,855,731		$	5,827,896
Costs of goods sold		728,924			914,778			1,580,421			1,943,162
Gross profit		2,185,134			2,035,516			4,275,310			3,884,734
Expenses:
Selling, general and administrative expenses		1,619,189			1,708,213			2,955,200			3,129,617
Depreciation and amortization		518,505			564,183			1,095,756			1,132,183
Total Operating expenses		2,137,694			2,272,396			4,050,956			4,261,800
Operating income (loss)		47,440			(236,880	)		224,354			(377,066	)
Other income (expense), net:
Interest expense		(581,100	)		(247,929	)		(1,277,082	)		(507,440	)
Other income (expense), net		62,252			63,208			59,660			481,643
Total other expense, net		(518,848	)		(184,721	)		(1,217,422	)		(25,797	)
Loss before income taxes		(471,408	)		(421,601	)		(993,068	)		(402,863	)
Income taxes		—			—			—			—
Net loss	$	(471,408	)	$	(421,601	)	$	(993,068	)	$	(402,863	)
Basic and diluted loss per share	$	0.00		$	0.00		$	(0.01	)	$	0.00
Basic and diluted weighted average number shares outstanding		147,207,875			95,518,317			147,090,388			95,518,317

See Notes to Condensed Consolidated Financial Statements.

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CornerWorld Corporation

Condensed Consolidated Statements of Stockholders’ Deficit

(unaudited)

					Additional Paid-in Capital			Accumulated Deficit			Total Stockholders’ Deficit
	Common Shares
	Shares		Amount
Balance, April 30, 2011		146,972,901	$	146,972	$	10,006,785		$	(10,892,727	)	$	(738,970	)
Stock-based compensation expense		—		—		74,892			—			74,892
Cash-less exercise of stock options and warrants		574,706		575		(575	)		—			—
Net loss		—		—		—			(993,068	)		(993,068	)
Balance, October 31, 2011		147,547,607	$	147,547	$	10,081,102		$	(11,885,795	)	$	(1,657,146	)

See Notes to Condensed Consolidated Financial Statements.

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CornerWorld Corporation

Condensed Consolidated Statements of Cash Flows

(unaudited)

	For the Six Months ended October 31,
	2011			2010
Cash Flows from Operating Activities
Net loss	$	(993,068	)	$	(402,863	)
Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation and amortization		1,095,756			1,132,183
Amortization of discount on debt		469,384			—
Provision for doubtful accounts		136,457			27,445
Stock-based compensation		74,892			74,627
Changes in operating assets and liabilities, net of acquisitions and divestitures:
Accounts receivable		(411,986	)		(6,905	)
Prepaid expenses and other current assets		19,200			40,266
Goodwill		—			—
Other assets		(278	)		3,057
Accounts payable		(746,700	)		(310,053	)
Accrued expenses		230,787			86,401
Deferred revenue		240,174			(26,707	)
Other liabilities		57,664			308,647
Net cash provided by operating activities		172,282			926,098
Cash Flows from Investing Activities
Proceeds from sale of fixed assets		5,900			—
Purchases of property and equipment		(14,601	)		(19,530	)
Net cash used in investing activities		(8,701	)		(19,530	)
Cash Flows from Financing Activities
Fees paid for debt issuance		(62,500	)		—
Principal payments on related party notes payable		(204,984	)		(660,000	)
Payments on related party line of credit		—			(150,000	)
Principal payments on debt		(250,000	)		—
Net cash used in financing activities		(517,484	)		(810,000	)
Net increase (decrease) in cash		(353,903	)		96,568
Cash at beginning of period		934,250			590,163
Cash at end of period	$	580,347		$	686,731
Cash paid for:
Interest	$	717,657		$	507,770
Income taxes	$	—		$	—

See Notes to Condensed Consolidated Financial Statements.

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CornerWorld Corporation

Notes to Condensed Consolidated Financial Statements

October 31, 2011

(unaudited)

1. Basis of Presentation

Interim Unaudited Condensed Consolidated Financial Statements

The unaudited interim condensed consolidated financial statements of CornerWorld Corporation (“CornerWorld” or the “Company”) as of October 31, 2011 and for the three and six month periods ended October 31, 2011 and 2010 contained in this Quarterly Report (collectively, “the Unaudited Interim Condensed Consolidated Financial Statements”) were prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for all periods presented. The results of operations for the three and six month periods ended October 31, 2011 are not necessarily indicative of the results that may be expected for the entire fiscal year.

The accompanying Unaudited Interim Condensed Consolidated Financial Statements have been prepared in accordance with the regulations for interim financial information of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited accompanying statements of financial condition and related interim statements of operations, cash flows, and stockholders’ deficit include all adjustments (which consist only of normal and recurring adjustments) considered necessary for a fair presentation in conformity with U.S. GAAP. These Unaudited Interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s consolidated financial statements as of and for the year ended April 30, 2011, as filed with the SEC on Form 10-K, and the unaudited interim condensed consolidated financial statements as of and for the period ended July 31, 2011, as filed with the SEC on Form 10-Q.

Organization

The Company was incorporated in the State of Nevada, on November 9, 2004 as Olympic Weddings International, Inc. Effective May 1, 2007, we changed our name to CornerWorld Corporation.

The Company entered into a Share Exchange Agreement and Plan of Merger (the “Agreement”) with Enversa Companies LLC, a Texas limited liability company (“Enversa”), Leadstream LLC, a Texas limited liability company (“Leadstream”), and the holders of the membership interests of Leadstream on August 27, 2008. Pursuant to the Agreement, on August 27, 2008, Leadstream merged with and into Enversa (the “Merger”), of which CornerWorld is the sole member. Enversa was the surviving company in the merger and, as such, acquired all right, title and interest in and to all real estate and other property of Leadstream and became responsible for all liabilities and obligations of Leadstream and Enversa.

Enversa  is a technology-oriented direct response marketing company. Using its proprietary technology, Enversa identifies qualified leads for advertisers thereby connecting them with potential consumers. Enversa utilizes a pay-for-performance pricing model which is very appealing to clients because it ensures that they are billed solely for campaign performance. Enversa also operates several ad networks and a proprietary request for proposal (RFP) technology that highlights promotional offers from a variety of corporate clients.   Finally, Enversa’s Gulf Media Solutions, LLC (“Gulf”) subsidiary, provides search engine optimization services (“SEO”), domain leasing and website management services on a recurring monthly basis to over 300 customers.

On February 23, 2009, the Company completed its acquisition (the “Woodland Acquisition”) of all of the issued and outstanding equity interests of each of Woodland Wireless Solutions, Ltd. (“Woodland Wireless”), West Michigan Co-Location Services, L.L.C. (“WMCLS”) and T2 TV, L.L.C. (“T2 TV”), and forty voting member units of S Squared, LLC, doing business in the state of Michigan as “Ranger Wireless LLC” (“Ranger”), through its newly-formed wholly-owned subsidiary, Woodland Holdings Corp. (“Woodland Holdings”), pursuant to the terms of a Stock Purchase Agreement, dated February 23, 2009 (the “Effective Date”), by and among Woodland Holdings, the Company, Ned B. Timmer and HCC Foundation (“HCC Foundation”). Immediately following the Woodland Acquisition, the forty voting member units of Ranger that were purchased by Woodland Holdings were contributed to Woodland Wireless and all other issued and outstanding voting member units of Ranger remained held by Woodland Wireless.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

As a result of the Woodland Acquisition, Ranger became a wholly-owned subsidiary of Woodland Wireless. In addition, pursuant to a Unit Purchase Agreement (the “Unit Purchase Agreement”) entered into on the Effective Date among Woodland Holdings, Phone Services and More, L.L.C., doing business as Visitatel (“PSM”), T2 Communications, L.L.C. (“T2 Communications”) and Ned B. Timmer, Woodland Holdings agreed to purchase all of the outstanding voting member units of each of PSM and T2 Communications, for an aggregate purchase price of $300,000. Final consummation of the transactions contemplated by the Unit Purchase Agreement took place on March 30, 2011. Prior to March 30, 2011, the Company accounted for PSM and T2 Communications as Variable Interest Entities (“VIE’s”) and consolidated them for accounting purposes.

Subsequent to the closing of the Unit Purchase Agreement, the Company slightly adjusted the manner in which it managed the assets acquired in the Woodland Acquisition; these assets comprise 100% of the Company’s Communication Services Segment. As a result of the closing of the Unit Purchase Agreement, Woodland Wireless, Ranger and WMCLS are collectively referred to herein as the “Ranger Wireless Group”. T2 Communications, T2TV and PSM are collectively referred to herein as the “T2 Group”.

RANGER® is a shortcode application service provider to the wireless industry. The core service offered is 611 Roaming Service™, a patented application providing seamless means for connecting wireless subscribers to reach their home providers customer service call center while roaming on another provider’s network. Calls are sent to RANGER® for treatment from nearly 40 wireless providers throughout North America. On an annual basis, RANGER® processes approximately 14 million calls with an infrastructure capable of handling millions more. RANGER® also manages an online portal which allows carriers access to their monthly statements and reporting on call volume to and from their company.

As a provider of Internet Protocol Television (IPTV), Internet and VoIP services, T² Communications delivers leading-edge technology to residential and business customers in Michigan. Offerings include: phone lines, Internet connections, 275 all-digital television stations, colocation, long distance and toll-free services. T² Communications is a Competitive Local Exchange Carrier (CLEC) that manages its own Fiber to the Premise (FTTP) network with a 10 gigabit backbone and up to 1 gigabit per second connections to end users.

PSM holds an FCC 214 License as a wholesale long distance service provider to the carrier community and large commercial users of transport minutes. Serving service providers, WMCLS offers telecommunications equipment storage and leasing.

The Company’s year-end is April 30^th.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and joint ventures as well as all entities deemed to qualify as VIE’s. All significant intercompany transactions and balances have been eliminated in consolidation.

2. Summary of Significant Accounting Policies

This summary of significant accounting policies is presented to assist in understanding the Company’s condensed consolidated financial statements. The condensed consolidated financial statements and notes are representations of the Company’s management who is responsible for their integrity and objectivity. These accounting policies conform to US GAAP and have been consistently applied in the preparation of the financial statements. The financial statements are stated in United States of America dollars.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of the contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates made by management include, among others, the realizability of accounts receivable, recoverability of property and equipment, intangibles and goodwill and valuation of stock-based compensation and deferred tax assets. Actual results could differ from these estimates.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

Fair Value of Financial Instruments

Accounting Standards Codification (“ASC”) No. 850 requires disclosure of fair value information about financial instruments when it is practicable to estimate that value. The carrying amount of the Company’s cash and cash equivalents, accounts receivable, accounts receivable-related party, accounts payable, accounts payable-related party, accrued liabilities, and notes payable approximate their estimated fair values due to their short-term maturities.

Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements.

Revenue Recognition

The Company recognizes revenue in accordance with Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements,” as revised by SAB 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable and collectibility is probable. Sales are recorded net of sales discounts.

At Enversa, revenue is recognized along with the related cost of revenue as leads are delivered. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. Amounts billed to clients in advance of delivery of leads are classified under current liabilities as deferred revenue. At Gulf, revenue is recognized monthly as SEO services are provided or in the form of revenues from domain leases.

For Woodland Wireless, the majority of revenue is derived from month-to-month, bundled service contracts for the phone, television and internet services used by each customer. Revenue is recognized as the services are provided.

Income Taxes

The Company accounts for income tax in accordance with ASC No. 740 which requires the use of the asset and liability method of accounting of income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Long-Lived Assets

The Company accounts for its long-lived assets in accordance with the ASC. The Company’s primary long-lived assets are website development costs, Goodwill, a patent, identifiable intangible assets and property and equipment. The ASC requires a company to assess the recoverability of its long-lived assets whenever events and circumstances indicate the carrying value of an asset or asset group may not be recoverable from estimated future cash flows expected to result from its use and eventual disposition. Management does not believe the Goodwill, patent and identifiable intangible assets associated with its recent acquisitions are impaired. No impairment charges have been recorded as of October 31, 2011.

Stock-Based Compensation

The Company accounts for awards made under its two stock-based compensation plans pursuant to the fair value provisions of ASC No. 718. ASC No. 718 requires the recognition of stock-based compensation expense, using a fair-value based method, for costs related to all share-based payments including stock options. ASC No. 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The Company accounts for stock-based compensation in accordance with ASC No. 718 and estimates its fair value based on using the Black-Scholes option pricing model.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

The Company’s determination of fair value of share-based payment awards is made as of their respective dates of grant using that option pricing model and is affected by the Company’s stock price as well as a number of subjective assumptions. These variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behavior. The expected term of options granted is derived from historical data on employee exercises and post-vesting employment termination behavior. The risk-free rate selected to value any particular grant is based on the U.S. Treasury rate that corresponds to the pricing term of the grant effective as of the date of the grant. The expected volatility is based on the historical volatility of the Company’s stock price. These factors could change in the future, affecting the determination of stock-based compensation expense in future periods. The Black-Scholes option pricing model was developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because the Company’s options have certain characteristics that are significantly different from traded options, the existing valuation models may not provide an accurate measure of the fair value of the Company’s options. Although the fair value of the Company’s options is determined in accordance with ASC No. 718 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. The calculated compensation cost is recognized on a straight-line basis over the vesting period of the options. See also Note 6 Stock Based Compensation, for more details.

Reclassifications

Certain prior year accounts have been reclassified to conform to the current year’s presentation.

3. Intangible Assets

Identifiable intangibles acquired in connection with business acquisitions accounted for under the purchase method are recorded at their respective fair values. The Company is amortizing the identifiable intangibles over their estimated useful lives, ranging from three to seven years. Intangibles consist of the following:

	October 31, 2011			April 30, 2011			Estimated Useful Life (Years)
Patent	$	10,904,792		$	10,904,792			7
Customer list		1,000,000			1,000,000			3
		11,904,792			11,904,792
Accumulated amortization		(5,154,208	)		(4,264,190	)
	$	6,750,584		$	7,640,602

Amortization expense related to identifiable intangible assets totaled $417,227 and $472,791 for the three month periods ended October 31, 2011 and 2010, respectively, and $890,018 and $945,582 for the six month periods ended October 31, 2011 and 2010, respectively.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

4. Debt

	As of
	October 31, 2011			April 30, 2011
Long-term Debt
Notes payable to Emerald Crest Capital (the “Senior Lender”); the notes mature March 31, 2015. The interest rate was floating at LIBOR plus 12%; the note’s floor utilizes a minimum LIBOR of 3%. At October 31, 2011 the total rate was 15%. These notes are collateralized by all assets of the Company.	$	4,750,000		$	5,000,000
Note payable IU Holdings, LP; the note matures November 30, 2013.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		1,500,000			1,500,000
Note payable to IU Investments, LLC, due March 31, 2016. At October 31, 2011, the interest rate was 10%. These notes are collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		527,915			610,166
Notes payable to Internet University and the other selling members of Enversa; the notes mature March 31, 2016.  At October 31, 2011 the interest rate was 10.0%. These notes are collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		1,364,199			1,364,199
Note payable to Internet University; the note matures October 31, 2012.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		300,000			375,000
Note payable to Timmer; the note matures April 30, 2016.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of Woodland Holdings, Corporation, including the Ranger patent.		1,800,000			1,800,000
Note payable to CEO; the note matures September 30, 2013.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		338,958			377,196
Note payable to Kelly Larabee Morlan; the note matures July 31, 2012.  At October 31, 2011, the interest rate was 10%. This note is not collateralized.		25,316			34,811
Total debt		10,606,388			11,061,372
Less current portion of long-term debt		(2,314,489	)		(2,706,973	)
Non-current portion of long-term debt	$	8,291,899		$	8,354,399

On March 29, 2011, the Company also entered into a warrant purchase agreement with the Senior Lender.  Pursuant to the warrant purchase agreement, the Company issued the Senior Lender a common stock purchase warrant (the "Warrant"), pursuant to which the Senior Lender may purchase up to 8,762,008 shares of the Company's common stock for an aggregate price of $100.  The warrant has a 5 year term and contains certain put and call provisions.  The Warrant is not exercisable prior to March 30, 2014.  Using the Black-Scholes model, the original value of the warrant issued to the Senior Lender was less than the net present value of the minimum $1,000,000 cash value of the warrants. Therefore, the net present value of $1,000,000, totaling $642,899 was recorded as a loan discount, which is being amortized to earnings as additional interest expense over the remaining term of the loan.  The warrant is revalued at each reporting date, and adjusted to earnings. In addition, other loan fees of $717,569 were incurred from the issuance of 75,104,584 shares of the Company’s stock, $512,750 was paid or accrued, and $52,467 was incurred from the grant of additional warrants during March 2011. These fees are being amortized to earnings as additional interest over the remaining term of the loans. The unamortized balance of these deferred costs was $1,411,244 and $1,880,406 at October 31 and April 30, 2011, respectively, and is reflected as a loan discount to the outstanding balance of $10,606,388 and $11,061,372 at October 31, 2011 and April 30, 2011, respectively.

The notes payable to the Senior Lenders include certain restrictive covenants with respect to the Company’s earnings, leverage and accounts payable. As of October 31, 2011, the Company believes it was in compliance with all restrictive covenants.

The notes are collateralized by 100% of the assets of the Company and its companies and the notes themselves are all cross-defaulted.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

5. Commitments and Contingencies

Litigation

The Company is occasionally involved in litigation matters relating to claims arising from the ordinary course of business. The Company’s management believes that there are no claims or actions pending or threatened against the Company, the ultimate disposition of which would have a material adverse effect on our business, results of operations and financial condition.

Employment Agreements

On July 28, 2011, the Company entered into an employment agreement with Mr. Scott Beck, its Chairman and CEO. Pursuant to his employment agreement, Mr. Beck is paid an annual base salary of $400,000, an annual performance based cash bonus subject to the discretion of the Board of Directors, an annual warrant to purchase 1% of the then outstanding common shares of the Company, a bonus fee of 2.00% of all equity and debt raised during the time of his contract, a 3.50% fee for the transaction value of all acquisitions as defined in his employment agreement, warrants equal to 3.25% of the equity issued pursuant to any debt and equity raised during the time of his employment agreement, a warrant equal to 3.25% of the transaction value of any equity issued in association with all acquisitions and the greater of 5% of fair market value or $5.0 million buyout fee in the case of a change in control; in addition, Mr. Beck’s employment agreement provides for an annual increase of Mr. Beck’s base salary by 5% every year during the term of the agreement. Mr. Beck’s employment agreement also provides that, if he is terminated without cause prior to the end of the employment agreement, he will be paid the full amount of his base salary for any days remaining in the full ten year term, the Company will purchase all equity instruments held by Mr. Beck and, finally, the Company will pay Mr. Beck $5.0 million within six months of his termination. Finally, Mr. Beck will receive 10% of amounts payable to the Company as a result of any patent infringement litigation. Mr. Beck’s employment agreement continues through July 27, 2021.

On September 13, 2011, the Company entered into an employment agreement with Mr. Marc Pickren, its President. Pursuant to his employment agreement, Mr. Pickren is paid an annual base salary of $220,000 and commissions based on new clients acquired by Mr. Pickren. Mr. Pickren was paid a one-time signing bonus of $55,000 related to entering into this agreement. In addition, in accordance with his employment agreement, on September 21, 2011, Mr. Pickren was issued 250,000 options to purchase the Company’s common stock at a price of $0.30 per share; the option contains vesting provisions consistent with other options issued to employees and expires at the end of 5 years. Mr. Pickren’s employment agreement continues through September 15, 2013.

6. Stock-Based Compensation

Incentive Stock Plan

On August 17, 2007, the Company’s board of directors adopted and implemented the Company’s 2007 Incentive Stock Plan. Under the Incentive Stock Plan, the Company is authorized to issue 4,000,000 shares of its common stock to the Company’s directors, officers, employees, advisors or consultants.

Any Incentive Stock Option granted to an employee of the Company shall become exercisable over a period of no longer than 5 years, and no less than 20% of the shares covered thereby shall become exercisable annually. 20% of shares vest annually beginning on the first anniversary of the grant. The options expire 10 years from the grant date.

The Company issued 955,000 stock options at a weighted average exercise price of $0.30/share pursuant to this plan during the six months ended October 31, 2011.

Stock Compensation Plan

On August 17, 2007, the Company’s board of directors adopted and implemented the Company’s 2007 Stock Compensation Plan. The total number of shares of the Company’s common stock which may be purchased or granted directly by Options, Stock Awards or Warrants under the Compensation Plan shall not exceed 4,000,000 shares of the Company’s common stock.

Awards granted to a participant of the Company shall become exercisable over a period of no longer than 5 years, and may vest as determined at the Company’s discretion at the time of grant.

The Company issued no stock options pursuant to this plan during the six months ended October 31, 2011.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

A summary of the shares reserved for grant and awards available for grant under each Stock Plan is as follows:

	October 31, 2011
	Shares Reserved for Grant		Awards Available for Grant
Incentive Stock Plan		4,000,000		1,705,000
Stock Compensation Plan		4,000,000		3,150,000
		8,000,000		4,855,000

The Company issues awards to employees, qualified consultants and directors that generally vest over time based solely on continued employment or service during the related vesting period and are exercisable over a five to ten year service period. Options are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant.

The fair value of each stock-based award is estimated on the grant date using the Black-Scholes option-pricing model. Expected volatilities are based on the historical volatility of the Company’s stock price. The expected term of options granted subsequent to the adoption of ASC No. 718 is derived using the simplified method as defined in the SEC’s SAB No. 107. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury interest rates in effect at the time of grant. The fair value of options granted was estimated using the following weighted-average assumptions:

	For the three month periods Ended October 31				For the six month periods Ended October 31
	2011		2010		2011		2010
Expected term (in years)	5.0		5.0		5.0		5.0
Expected volatility	99.1	%	99.1	%	99.1	%	99.1	%
Risk-free interest rate	1.0	%	2.3	%	1.0	%	2.3	%
Dividend yield	0.0	%	0.0	%	0.0	%	0.0	%

A summary of activity under the Stock Plans and changes during the period ended October 31, 2011 is presented below:

	Weighted-Average
	Shares			Exercise Price		Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding at May 1, 2011		2,520,000		$	0.35		3.36	$	0
Issued		955,000		$	0.30		5.00	$	0
Cancelled/forfeited		(270,179	)		0.20
Exercised		(59,821	)		0.20
Outstanding at October 31, 2011		3,145,000		$	0.34		3.31	$	47,600
Options vested and expected to vest*		2,965,000		$	0.35		3.25	$	22,300
Options exercisable at end of period		1,316,250		$	0.40		2.33	$	22,300

* Due to the Company’s limited operating history, no estimate for forfeitures has been made in these financial statements as there has been no turnover of employees to whom options were granted.

For the three month periods ended October 31, 2011 and 2010, the Company recognized $37,446 and $37,371 of stock-based compensation expense, respectively, and for the six month periods ended October 31, 2011 and 2010, the Company recognized $74,892 and $74,627 of stock-based compensation expense, respectively. As of October 31, 2011 there was $398,303 of total unrecognized compensation cost, net of forfeitures, related to unvested employee and director stock option compensation arrangements. That cost is expected to be recognized on a straight-line basis over the next 3.31 weighted average years.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

7. Business Segments

Our business consists primarily of two integrated business segments: (i) marketing services and (ii) communications services. Our corporate administrative functions are tracked separately and the associated costs are not pushed down to the operating segments. The following table summarizes selected financial information for each operating segment:

	Marketing Services		Communications Services		Corporate Overhead			Consolidated
Three Months Ended October 31, 2011
Revenue	$	1,234,927	$	1,679,131	$	—		$	2,914,058
Income (loss) from continuing operations before tax		48,371		499,934		(1,019,713	)		(471,408	)
Net (loss) income		48,371		499,934		(1,019,713	)		(471,408	)
Total assets		964,246		10,176,725		783,710			11,924,681
Intangibles		—		6,750,584		—			6,750,584
Goodwill		—		1,581,850		554,986			2,136,836
Depreciation and amortization		29,316		472,777		16,412			518,505

	Marketing Services		Communications Services			Corporate Overhead			Consolidated
Three Months Ended October 31, 2010
Revenue	$	1,282,356	$	1,667,938		$	—		$	2,950,294
Income (loss) from continuing operations before tax		50,644		(7,057	)		(465,188	)		(421,601	)
Net (loss) income		50,644		(7,057	)		(465,188	)		(421,601	)
Total assets		1,140,054		12,173,565			529,874			13,843,493
Intangibles		277,772		8,308,412			—			8,586,184
Goodwill		—		1,581,850			554,986			2,136,836
Depreciation and amortization		83,334		474,309			6,540			564,183

	Marketing Services		Communications Services		Corporate Overhead			Consolidated
Six Months Ended October 31, 2011
Revenue	$	2,704,500	$	3,151,231	$	—		$	5,855,731
Income (loss) from continuing operations before tax		77,009		798,419		(1,868,496	)		(993,068	)
Net (loss) income		77,009		798,419		(1,868,496	)		(993,068	)
Total assets		964,246		10,176,725		783,710			11,924,681
Intangibles		—		6,750,584		—			6,750,584
Goodwill		—		1,581,850		554,986			2,136,836
Depreciation and amortization		114,013		949,157		32,586			1,095,756

	Marketing Services			Communications Services		Corporate Overhead			Consolidated
Six Months Ended October 31, 2010
Revenue	$	2,458,385		$	3,369,511	$	—		$	5,827,896
Income (loss) from continuing operations before tax		(96,109	)		549,107		(855,861	)		(402,863	)
Net (loss) income		(96,109	)		549,107		(855,861	)		(402,863	)
Total assets		1,140,054			12,173,565		529,874			13,843,493
Intangibles		277,772			8,308,412		—			8,586,184
Goodwill		—			1,581,850		554,986			2,136,836
Depreciation and amortization		168,366			947,844		15,973			1,132,183

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

There were no intersegment sales. All of the Company’s business activities are conducted within the United States geographic boundaries.

8. Related Party Transactions

Enversa receives administrative support from Internet University, Inc., which was one of the three former members of Leadstream. Included in such administrative support are human resources and payroll services which totaled less than $20,000 for the six month period ended October 31, 2011.

As part of the Enversa acquisition, the Company borrowed $1,500,000 from Internet University, Inc., Marc Blumberg and Marc Pickren (collectively, the “Enversa Sellers”).   Mr. Blumberg is a member of the Company’s Board of Director as well as the president of Internet University, Inc. and Mr. Pickren is the President of the Company.  On March 30, 2011, the Company entered into amendments to its promissory notes with the Enversa Sellers (collectively the “Tier 4 Junior Notes”). The amendments to the Tier 4 Junior Notes revised the repayment schedules of the Tier 4 Junior Notes such that principal payments would be payable annually beginning on March 31, 2012 until such time as the Tier 4 Junior Notes mature on March 31, 2016. Interest payments are payable monthly at a revised rate of 15% per annum. The Company recorded interest of $93,029 and $33,097 on this facility during the six month periods ended October 31, 2011 and 2010, respectively.  The balance of the facility totaled $1,364,199 at October 31, 2011.

As part of the February 23, 2009 Woodland Acquisition, the Company borrowed $1,900,000 from IU Investments LLC. On March 30, 2011, the Company entered into Amendment No. 3 (“IU Amendment No. 3”) to its Promissory Note to IU Investments, LLC (the “Tier 3 Junior Note”).  IU Amendment No. 3 revised the repayment schedule of the Tier 3 Junior Note such that the Company will make principal payments totaling $27,417/month until February 28, 2012, after which time the Company will pay a lump sum of $191,919 then $67,200 annually beginning March 31, 2011 until such time as the Tier 3 Junior Note is paid in full on March 31, 2016. Interest payments are payable monthly at a rate of 10% per annum.  A member of the Company’s Board of Directors as well as one of the selling partners of Enversa is an employee of the parent of IU Investments, LLC. The Company recorded interest of $28,384 and $53,637 on this facility during the six month periods ended October 31, 2011 and 2010, respectively.   The balance of this note totaled $527,915 at October 31, 2011.

On March 30, 2011, the Company entered into a subordinated $1.5 million promissory note (the “Tier 2 Junior Note”) with IU Holdings, LP (“IUH”).  Principal under the Tier 2 Junior Note is payable in quarterly installments of $187,500  commencing on February 29, 2012 until such point as the Tier 2 Junior Note matures on November 30, 2013.  Interest on the outstanding principal amount under the Tier 2 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce the Tier 2 Junior Lender to enter into this Promissory Note, the Company issued the Tier 2 Junior Lender, 48,414,132 shares of CornerWorld Corporation Common stock.  IUH is a partnership whose limited partners include friends and family of the Company’s Chief Executive Officer.  The Company paid approximately $85,726 in interest on this facility, during the six month period ended October 31, 2011, to IUH as a result of this note.  The balance of this note totaled $1,500,000 at October 31, 2011.

On March 30, 2011, the Company entered into a subordinated $400,000 promissory note (the “Tier 5 Junior Note”) with Internet University.  Principal under the Tier 5 Junior Note is payable in monthly installments of $25,000  commencing on April 30, 2011 until such point as the Tier 5 Junior Note matures on October 31, 2012.  Interest on the outstanding principal amount under the Tier 5 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce the Tier 5 Junior Lender to enter into this Promissory Note, the Company issued the Tier 5 Junior Lender, 12,910,435 shares of CornerWorld Corporation Common stock.  The Company recorded interest of $22,068 on this facility during the six month period ended October 31, 2011.  The balance of this note totaled $300,000 at October 31, 2011.

On March 30, 2011, the Company entered into a subordinated $389,942 promissory note (the “Tier 7 Junior Note”) with Scott N. Beck, the Company’s Chief Executive Officer.  Principal under the Tier 7 Junior Note is payable in monthly installments of $12,746  commencing on April 30, 2011 until such point as the Tier 7 Junior Note matures on September 30, 2013.  Interest on the outstanding principal amount under the Tier 7 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce Mr. Beck to enter into this Promissory Note, the Company issued Mr. Beck 12,585,802 shares of CornerWorld Corporation Common stock.  The Tier 7 Junior Note consists primarily of prior accounts payable.  The Company recorded interest of $17,730 on this facility during the six month period ended October 31, 2011.  The balance of this note totaled $338,958 at October 31, 2011.

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CornerWorld Corporation

Notes to the Unaudited Condensed Consolidated Financial Statements – (Continued)

On March 30, 2011, the Company entered into an unsecured $37,976 promissory note (the “Tier 8 Junior Note”) with Kelly Larabee Morlan; Ms. Morlan is the Secretary of the Company.  Principal under the Tier 8 Junior Note is payable in monthly installments of $3,165  commencing on April 30, 2011 until such point as the Tier 8 Junior Note matures on September 30, 2012.  Interest on the outstanding principal amount under the Tier 8 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce Ms. Morlan to enter into this Promissory Note, the Company issued Ms. Morlan 1,194,215 shares of CornerWorld Corporation Common stock.  The Tier 8 Junior Note is unsecured.  The Company recorded interest of $1,436 on this facility during the three month period ended October 31, 2011.  The balance of this note totaled $25,316 at October 31, 2011.

In addition, the Company leases office space with an entity that is controlled by the family of the Company’s CEO. During the six month period ended October 31, 2011, the Company paid $101,522 in rent as a result of this lease.

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RISKS ASSOCIATED WITH FORWARD-LOOKING STATEMENTS INCLUDED IN THIS FORM 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

CornerWorld Corporation (hereinafter referred to as “CornerWorld,” the “Company,” “we,” “our,” or “us”) is a marketing and technology services company building services for the increased accessibility of content across mobile, television and Internet platforms. Our key asset is a patented 611 Roaming Service™ from RANGER Wireless Solutions®, which generates revenue by processing over 14 million calls per year from wireless customers and seamlessly connecting them to their service provider.

Six months ended October 31, 2011 Highlights:

• We paid down approximately $454,984 in principal on our outstanding debt.

• After removal of non-cash amortization of loan discounts (interest expense) totaling $469,384, the non-recurring impact of our pursuit of a potential merger which was never completed totaling $228,390 and, finally, depreciation & amortization and stock-based compensation expense totaling $1,095,756 and $74,892, respectively, the Company’s pro-forma profit for the six months ended October 31, 2011 would have totaled approximately $875,354. See the table that follows for more details. The Company expects to generate positive operating cash flows for the fiscal year ending April 30, 2012.

We define “Adjusted Net Income¹” as net loss after removal of non-cash charges including amortization of loan discounts (interest expense), depreciation, amortization of intangibles and stock-based compensation. Management believes pro-forma net income provides useful additional information concerning the Company’s potential profitability. However, Adjusted Net Income is not a measure of financial performance under Generally Accepted Accounting Principles (“GAAP”). Accordingly, Adjusted Net Income should not be considered an alternative to net income as an indicator of operating performance. The table that follows provides a reconciliation between GAAP net income and Adjusted Net Income.

___________________________

¹ This measure presented may not be comparable to similarly titled measures reported by other companies.

Reconciliation between GAAP Net Income and Adjusted Net Income:

	For the six month period ended October 31, 2011			Per share data
Net loss	$	(993,068	)	$	(0.01	)
Non-cash charges:
Amortization of loan discounts (interest)		469,384			0.00
Non-recurring fees associated with aborted acquisition		228,390			0.00
Stock-based compensation		74,892			0.00
Depreciation and amortization		1,095,756			0.01
Total non-cash charges		1,868,422			0.01
Pro-forma net income	$	875,354		$	0.01
Weighted average common shares outstanding:
Basic and diluted		147,090,388			147,090,388

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Service Offerings

Our business consists primarily of two integrated business segments: (i) marketing services and (ii) communications services. Our corporate administrative functions are tracked separately and the associated costs are not pushed down to the operating segments. See also Note 7 of the Notes to the Unaudited Condensed Consolidated Financial Statements – Business Segments for additional segment information.

Critical Accounting Policies and Estimates

Use of Estimates and Critical Accounting Policies

In preparing our condensed consolidated unaudited financial statements, we make estimates, assumptions and judgments that can have a significant effect on our revenues, income (loss) from operations, and net income (loss), as well as on the value of certain assets on our consolidated balance sheet. We believe that there are several accounting policies that are critical to an understanding of our historical and future performance as these policies affect the reported amounts of revenues, expenses and significant estimates and judgments applied by management. While there are a number of accounting policies, methods and estimates affecting our financial statements, areas that are particularly significant include allowance for doubtful accounts, impairment of long-lived assets (including goodwill), revenue recognition and stock-based compensation. In addition, please refer to Note 2 of the Notes to the Unaudited Condenses Consolidated Financial Statements for further discussion of our accounting policies.

Allowance for Doubtful Accounts

We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The allowance for doubtful accounts is based on an estimate of buckets of customer accounts receivable, stratified by age, that, historically, have proven to be uncollectible; in addition, in certain cases, the allowance estimate is supplemented by specific identification of larger customer accounts and our best estimate of the likelihood of potential loss, taking into account such factors as the financial condition and payment history of major customers. We evaluate the collectibility of our receivables at least quarterly. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. The differences could be material and could significantly impact cash flows from operating activities.

Impairment of Long-Lived Assets

The Company’s management assesses the recoverability of its long-lived assets by determining whether the depreciation and amortization of long-lived assets over their remaining lives can be recovered through projected undiscounted future cash flows. The amount of long-lived asset impairment is measured based on fair value and is charged to operations in the period in which long-lived asset impairment is determined by management.

Goodwill

Goodwill represents the excess of acquisition cost over the net assets acquired in a business combination. Management reviews, on an annual basis, the carrying value of goodwill in order to determine whether impairment has occurred. Impairment is based on several factors including the Company’s projection of future undiscounted operating cash flows. If an impairment of the carrying value were to be indicated by this review, the Company would adjust the carrying value of goodwill to its estimated fair value.

Income Taxes

The Company accounts for income tax in accordance with ASC No. 740 which requires the use of the asset and liability method of accounting of income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

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Revenue Recognition

It is the Company’s policy that revenue from product sales or services will be recognized in accordance with Staff Accounting Bulletin No. 104, “Revenue Recognition” (“SAB No. 104”), which superseded Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements” (“SAB No. 101”). SAB No. 104 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product was not delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

Stock-Based Compensation

The Company accounts for awards made under its two stock-based compensation plans pursuant to the fair value provisions of ASC No. 718. ASC No. 718 requires the recognition of stock-based compensation expense, using a fair-value based method, for costs related to all share-based payments including stock options. ASC No. 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The Company accounts for stock-based compensation in accordance with ASC No. 718 and estimates its fair value based on using the Black-Scholes option valuation model.

The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. This model also requires the input of highly subjective assumptions including:

(a)	The expected volatility of our common stock price, which we determine based on historical volatility of our common stock over the prior eighteen month period;
(b)	Expected dividends (which do not apply, as we do not anticipate issuing dividends);
(c)	Expected life of the award, which is estimated based on the historical award exercise behavior of our employees; and
(d)	The risk-free interest rate which we determine based on the yield of a U.S. Treasury bond whose maturity period equals the options expected term.

These factors could change in the future, affecting the determination of stock-based compensation expense in future periods. In the future, we may elect to use different assumptions under the Black-Scholes valuation model or a different valuation model, which could result in a significantly different impact on our net income or loss.

The Company’s determination of fair value of share-based payment awards is made as of their respective dates of grant using the Black Scholes option valuation model. Because the Company’s options have certain characteristics that are significantly different from traded options, the Black Scholes option valuation model may not provide an accurate measure of the fair value of the Company’s options. Although the fair value of the Company’s options is determined in accordance with ASC No. 718, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. The calculated compensation cost is recognized on a straight-line basis over the vesting period of the options.

See also Note 6 – Stock Based Compensation of the Notes to the Unaudited Condensed Consolidated Financial Statements for additional information regarding our accounting policies for stock-based compensation.

Recent Accounting Pronouncements

There were various accounting standards and interpretations issued during the six months ended October 31, 2011, none of which are expected to have a material impact on the Company’s consolidated financial position, operations, or cash flows.

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Results of Operations

Comparison of the three months ended October 31, 2011 to the three months ended October 31, 2010

Marketing services

Our marketing services segment consists of our Enversa division.

Revenues and Gross profit:

Our marketing segment had revenues totaling $1,234,927 for the three month period ended October 31, 2011 as compared to $1,282,356 for the three month period ended October 31, 2010. This slight decrease is due to the loss of a significant enterprise client which was offset, to some degree, by the addition of revenues from search engine optimization and site leases at our Gulf division.

As a result of selling the higher margin Gulf products, gross profit at our marketing services segment increased for the three months ended October 31, 2011 to $753,069 from $686,385 for the three month period ended October 31, 2010. Gross profit as a percentage of revenue decreased from 61.0% to 56.9%.

Selling, General and Administrative Expenses:

Selling, general and administrative (“SG&A”) expenses totaled $675,382 for the three months ended October 31, 2011 as compared to $550,036 for the corresponding period in the prior year. The increase of $125,346 is primarily due to increases in headcount, rent and utilities associated with the build-up of our Gulf division.

Net Income:

Net income totaled $48,371 for the three months ended October 31, 2011 as compared to net income of $50,644 for the corresponding period in the prior year. The slight decrease is primarily due to our aforementioned SG&A increases associated with our growing Gulf business.

Communications services

Our communications services segment consists of all the businesses acquired in the Woodland Acquisition.

Revenues and Gross profit:

Our communications services segment had revenues totaling $1,679,131 for the three month period ended October 31, 2011 as compared to $1,667,938 for the three month period ended October 31, 2010. This increase is primarily due to the fact that, as a result of our two largest customers merging in the second half of calendar year 2009, the Company acquired a new customer as a result of the divestiture of certain overlapping customer bases.    Because the merger was completed in the second half of 2009 and the divestiture of certain markets was just recently completed, the Company believes the merger’s impact on revenues has been fully realized but can make no guarantees that there will not be additional revenue fluctuations as a result of the acquisition of the new customer.

Gross profit increased for the three months ended October 31, 2011 to $1,432,065 from $1,349,131 for the three month period ended October 31, 2010 due to implementation of new agreements with lower rates from the carriers who provide our network infrastructure which resulted in lower rates paid by the Company. Gross profit as a percentage of revenue increased substantially to 85.3% from 80.9% during the three months ended October 31, 2010 as a result of these initiatives.

Selling, General and Administrative Expenses:

SG&A expenses totaled $125,863 for the three months ended October 31, 2011 as compared to $679,973 for the corresponding period in the prior year. The decrease of $554,110 is primarily due to the absence of non-recurring legal expenses totaling $246,894 incurred during the three month period ended October 31, 2010 along with cost savings resulting from staff reductions, relocation of offices to cheaper space and other cost cutting measures.

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Net Income:

Net income totaled $499,934 for the three months ended October 31, 2011 as compared to a net loss of $7,057 for the corresponding period in the prior year. The improvement of $506,991 is primarily due to the absence of non-recurring legal fees totaling $246,894 as well as the impact of the aforementioned cost reductions both in cost of sales and SG&A.

Corporate

Selling, General and Administrative Expenses:

SG&A costs totaled $817,944 for the quarter ended October 31, 2011 versus $478,204 for the corresponding period in the prior year. The increase of $339,740 is primarily due to the fact that we incurred approximately $230,000 in costs related to our pursuit of a potential merger which was never completed.  We also incurred additional fees at Corporate primarily due to the fact that we hired additional accounting and IT personnel as necessary to develop Gulf.  Expenses for this segment also include all costs associated with corporate overhead, including accounting, legal, corporate governance and other related costs involved in being a publicly traded company.

Comparison of the six months ended October 31, 2011 to the six months ended October 31, 2010

Marketing services

Revenues and Gross profit:

Our marketing services segment had revenues totaling $2,704,500 for the six month period ended October 31, 2011 as compared to $2,458,385 for the six month period ended October 31, 2010. This increase is due to the addition of revenues from search engine optimization and site leases at our Gulf division.

For the same reasons, gross profit at our marketing services segment increased for the six months ended October 31, 2011 to $1,584,392 from $1,180,700 for the six month period ended October 31, 2010. Gross profit as a percentage of revenue increased from 48.0% to 58.6% due to an increase in sales of Gulf’s higher margin products.

Selling, General and Administrative Expenses:

SG&A expenses totaled $1,390,384 for the six months ended October 31, 2011 as compared to $1,104,013 for the corresponding period in the prior year. The increase of $286,371 is primarily due to the aforementioned increase in personnel associated with our Gulf division which resulted in corresponding increases in headcount, rent and utilities.

Net Income

Net income totaled $77,009 for the six months ended October 31, 2011 as compared to net loss of $96,109 for the corresponding period in the prior year. The difference is primarily due to the margin increases at our Gulf division.  In addition, we recorded bad debt expense of $27,445 during the three month period ended July 31, 2010 related to problems associated with revenues from one customer.

Communications services

Revenues, Cost of Sales and Gross profit:

Our communications services segment had revenues totaling $3,151,231 for the six month period ended October 31, 2011 as compared to $3,369,511 for the three month period ended October 31, 2010. This decrease is primarily due to the fact that our two largest customers merged in the second half of calendar year 2009 and, accordingly, the Company experienced a reduction in roaming revenues.

For similar reasons, gross profit decreased for the six months ended October 31, 2011 to $2,690,918 from $2,704,034 for the corresponding period in the prior year. Gross profit as a percentage of revenue improved to 85.4% during the six months ended October 31, 2011 versus 80.3% during the corresponding period in the prior year primarily due to the implementation of new agreements with lower rates from the carriers who provide our network infrastructure.

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Selling, General and Administrative Expenses:

SG&A expenses totaled $252,812 for the six months ended October 31, 2011 as compared to $1,209,712 for the corresponding period in the prior year. The substantial decrease of $956,900 is primarily due to non-recurring legal expenses which totaled $420,311 incurred during the six month period ended October 31, 2010.  We settled this lawsuit in March 2011 and, accordingly, are no longer incurring similar fees.  Absent legal expenses, the SG&A decrease is attributable primarily to staffing reductions and other cost saving measures enacted at our communications services segment during the year over year period.

Net Income

Net income totaled $798,419 for the six months ended October 31, 2011 as compared to net income of $549,107 for the corresponding period in the prior year. The increase of $249,312 is primarily due to the absence of non-recurring legal expenses which totaled $420,311 during the six month period ended October 31, 2010 which was offset, to some degree, by the fact that we received a favorable lawsuit settlement during the six month period ended October 31, 2010.

Corporate

Selling, General and Administrative Expenses:

SG&A expenses totaled $1,312,004 for the six month period ended October 31, 2011 versus $815,892 for the corresponding period in the prior year. The increase of $496,112 is primarily due to the fact that we incurred approximately $230,000 in costs related to our pursuit of a potential merger which was never completed.  We also incurred additional fees at Corporate primarily due to the fact that we hired additional accounting and IT personnel as necessary to develop Gulf.  Expenses for this segment also include all costs associated with corporate overhead, including accounting, legal, corporate governance and other related costs involved in being a publicly traded company.

Liquidity and Capital Resources

As of October 31, 2011, we had a working capital deficit of approximately $2.6 million and cash of $580,347. Our working capital deficit is primarily related to certain large accounts payable associated with our 2009 Woodland Acquisition as well as the short-term nature of selected tranches of the debt we issued in March 2011 when we recapitalized the Company. Our working capital deficit has decreased substantially from our October 31, 2010 period end deficit which totaled approximately $4.5 million. This improvement is due to the fact that, as a result of the March 2011 recapitalization, we extended the maturities of substantially all of our debt. We believe the cash flows from our existing operations will be adequate to manage our debt commitments and we have good relationships with the vendors associated with the large accounts payable who we continue to pay with excess cash flow. Management expects that its current cash and operational cash flow will be sufficient to meet our liquidity needs for the next year.

Our investing activity for the six month period ended October 31, 2011, consisted primarily of $14,601 of capital expenditures, primarily associated with the relocation of several of our facilities, including our home office.  Management believes the reduced rents in the new locations will more than offset the capital expenditures.

We have no other bank financing or other external sources of liquidity. We source all of our liquidity through our operations.  We expect that trend to continue.

We will most likely need to obtain additional capital in order to further expand our operations. We are currently investigating other financial alternatives, including additional equity and/or debt financing. In order to obtain capital, we may need to sell additional shares of our common stock or borrow funds from private lenders. However, there can be no assurance that any additional financing will become available to us, and if available, that such financing will be on terms acceptable to us.

Off-balance sheet arrangements

We have not entered into any off-balance sheet arrangements.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) or 15d-15(e)) designed to ensure that information required to be disclosed in reports filed or submitted under the Securities Exchange Act of 1934, as amended (the Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in its reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

The Company’s management, with the participation of its principal executive officer and its chief financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in the Exchange Act Rules 13a-15(e) or 15d-15(e)) as of October 31, 2011. Based on that evaluation, the Company’s chief executive officer and chief financial officer concluded that, as of that date, the Company’s disclosure controls and procedures, were not effective at a reasonable assurance level.

Management’s Remediation Plan

Management determined that a material weakness existed due to an inability to appropriately segregate duties in the accounting department due to a lack of the number of personnel in the accounting department. The Company has replaced selected accounting personnel with more seasoned professionals, including additional certified public accountants, to help perform certain accounting and financial functions. In addition, management has included additional reviews and controls to mitigate the size of the accounting department and the overlap of responsibilities.  Management believes the foregoing efforts have effectively remediated this material weakness but the Company can give no assurance that the additional controls will be effective. As the Company continues to evaluate and work to improve its internal control over financial reporting, management may determine to take additional measures to address control deficiencies or determine to modify the remediation plan described above. We cannot assure you that, as circumstances change, any additional material weakness will not be identified.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

Not applicable.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. [Removed and Reserved]

Item 5. Other information

None.

Item 6. Exhibits

The following exhibits are filed as part of this report:

Exhibit Numbers	Description	Method of Filing
3.1	Articles of Incorporation of CornerWorld Corporation, formerly known as Olympic Weddings International, Inc., dated November 9, 2004 (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form SB-2, filed September 27, 2005)
3.2	Certificate of Correction of CornerWorld Corporation, formerly known as Olympic Weddings International, Inc., dated November 24, 2004 (incorporated by reference to Exhibit 3.2 to the Company’s Form 10-Q, filed December 15, 2010)
3.3	Certificate of Change of CornerWorld Corporation, formerly known as Olympic Weddings International, Inc., dated October 18, 2006 (incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K, filed October 25, 2006)
3.4	Certificate of Amendment to Articles of Incorporation For Nevada Profit Corporations of CornerWorld Corporation, formerly known as Olympic Weddings International, Inc., dated May 4, 2007 (incorporated by reference to Exhibit 3.2 to the Company’s Form 10-Q, filed December 15, 2010)
3.5	Bylaws of CornerWorld Corporation, formerly known as Olympic Weddings International, Inc., dated November 9, 2004 (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form SB-2, filed September 27, 2005)
10.1	Employment Agreement by and between Cornerworld Corporation and Marc Pickren dated September 13, 2011	w
10.2	Amendment, dated as of December 15, 2011, to Scott Beck employment agreement.	w(1)
10.3	Stock option, dated as of September 21, 2011, for Marc Pickren to purchase 250,000 shares of Common Stock	w(1)
31.1	Rule 13a-14(a) Certification by our chief executive officer	(1)
31.2	Rule 13a-14(a) Certification by our chief financial officer	(1)
32.1	Section 1350 Certification by our chief executive officer	(2)
32.2	Section 1350 Certification by our chief financial officer	(2)
101	Interactive Data Files of Financial Statements and Notes.	(3)

__________

(1)	Filed herewith.
(2)	Furnished (and not filed) herewith pursuant to Item 601(b)(32)(ii) of Regulation S-K under the Exchange Act.
(3)	Furnished (and not filed) herewith pursuant to Regulation S-T under the Exchange Act.
w	Management plan, compensatory arrangement or employment agreement.

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	CORNERWORLD CORPORATION
	Registrant
December 20, 2011	/s/ V. Chase McCrea III
	V. Chase McCrea III
	Chief Financial Officer

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EX-10

Exhibit 10.2

AMENDMENT NUMBER 1 TO EMPLOYMENT AGREEMENT DATED JULY 28, 2011
BETWEEN CORNERWORLD CORPORATION AND SCOTT N. BECK

WITNESSETH:

WHEREAS, on July 28, 2011, CornerWorld Corporation and its Chief Executive Officer, Scott N. Beck (collectively the “Parties”) entered into an employment agreement (the “Agreement”).

WHEREAS, the Parties noticed an error in the Agreement and both Parties wished to correct the error.

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter contained, and for other good and valuable consideration, notwithstanding any provisions of the Agreement to the contrary, the Parties hereto hereby agree to the following:

Item 1(c) shall commence on the first anniversary dated of the Effective Date and continue for a total of ten (10) anniversary dates.

CORNERWORLD CORPORATION

By: /s/ Marc Blumberg

Marc Blumberg

Director

EX-10

Exhibit 10.3

CORNERWORLD CORPORATION

INCENTIVE STOCK OPTION AGREEMENT

THIS INCENTIVE STOCK OPTION AGREEMENT (“Agreement”) is made and entered into as of the date set forth below, by and between CORNERWORLD  CORPORATION, a Nevada corporation (the “Company”), and the employee of the Company named in Section 1(b). (“Optionee”):

In consideration of the covenants herein set forth, the parties hereto agree as follows:

1. Option Information.

(a)	Date of Option:	September 21, 2011
(b)	Optionee:	Marc Pickren
(c)	Number of Shares:	250,000
(d)	Exercise Price:	$0.30

2. Acknowledgements.

(a) Optionee is an employee of the Company.

(b) The Board of Directors (the “Board” which term shall include an authorized committee of the Board of Directors) and shareholders of the Company have heretofore adopted a 2007 Incentive Stock Plan (the “Plan”), pursuant to which this Option is being granted.

(c) The Board has authorized the granting’ to Optionee of an incentive stock option (“Option”) as defined in Section 422 of the Internal Revenue Code of 1986, as amended, (the “Code”) to purchase shares of common stock of the Company (“Stock”) upon the terms and conditions hereinafter stated and pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”) provided by Rule 701 thereunder.

3. Shares; Price. The Company hereby grants to Optionee the right to purchase, upon and subject to the terms and conditions herein stated, the number of shares of Stock set forth in Section l(c) above (the “Shares”) for cash (or other consideration as is authorized under the Plan and acceptable to the Board, in their sole and absolute discretion) at the price per Share set forth in Section led) above (the “Exercise Price”), such price being not less than the fair market value per share of the Shares covered by this Option as of the date hereof (unless Optionee is the owner of Stock possessing ten  percent or   more of the total  voting power or  value of all outstanding Stock of the Company, in which case the Exercise Price shall be no less than 110% of the fair market value of such Stock).

4. Term of Option; Continuation of  Employment. This Option shall expire, and all rights hereunder to purchase the Shares shall terminate five (5) years from the date hereof. This Option shall earlier terminate subject to Sections 7 and 8 hereof upon, and as of the date of, the termination of Optionee’s employment if such termination occurs prior to the end of such five (5) year period. Nothing contained herein shall confer upon Optionee the right to the continuation of his or her employment by the Company or to interfere with the right of the Company to terminate such employment or to increase or decrease the compensation of Optionee from the rate in existence at the date hereof.

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5. Vesting of Option. Subject to the provisions of Sections 7 and 8 hereof, this Option shall become exercisable during the term of Optionee’s employment in four (4) equal annual installments of twenty-five percent (25%) of the Shares covered by this Option, the first installment to be exercisable on the six (6) month anniversary of the date of this Option (the “Initial Vesting Date”), with an additional twenty-five percent (25%) of such Shares becoming exercisable on each of the three (3) successive twelve (12) month periods following the Initial Vesting Date. The installments shall be cumulative (Le., this option may be exercised, as to any or all Shares covered by an installment, at any time or times after an installment becomes exercisable and until expiration or termination of this option).

6. Exercise. This Option shall be exercised by delivery to the Company (a) written notice of exercise stating the number of Shares being purchased (in whole shares only) and such other information set forth on the form of Notice of Exercise attached hereto as Appendix A, (b) a check or cash in the amount of the Exercise Price of the Shares covered by the notice (or such other consideration as has been approved by the Board of Directors consistent with the Plan) and (c) a written investment representation as provided for in Section 13 hereof. Notwithstanding anything to the contrary contained in this Option, this Option may be exercised by presentation and surrender of this Option to the Company at its principal executive offices with a written notice of the holder’s intention to effect a cashless exercise, including a calculation of the number of shares of Common Stock to be issued upon such exercise in accordance with the terms hereof (a “Cashless Exercise”). In the event of a Cashless Exercise, in lieu of paying the Exercise Price in cash, the holder shall surrender this Option for that number of shares of Common Stock determined by multiplying the number of Shares to which it would otherwise be entitled by a fraction, the numerator of which shall be the difference between the then current Market Price per share of the Common Stock and the Exercise Price, and the denominator of which shall be the then current Market Price per share of Common Stock. For example, if the holder is exercising 100,000 Options with a per Option exercise price of $0.75 per share through a cashless exercise when the Common Stock’s current Market Price per share is $2.00 per share, then upon such Cashless Exercise the holder will receive 62,500 shares of Common Stock. Market Price is defined as the average of the last reported sale prices on the principal trading market for the Common Stock during the five (5) trading days immediately preceding such date. This Option shall not be assignable or transferable, except by will or by the laws of descent and distribution, and shall be exercisable only by Optionee during his or her lifetime, except as  provided in Section 8 hereof.

7. Termination of Employment. If Optionee shall cease to be employed by the Company for any reason, whether voluntarily or involuntarily, other than by his or her death, Optionee (or if the Optionee shall die after such termination, but prior to such exercise date, Optionee’s personal representative or the person entitled to succeed to the Option) shall have the right at any time within three (3) months following such termination of employment or the remaining term of this Option whichever is the lesser, to exercise in whole or in part this Option to the extent, but only to the extent, that this Option was exercisable as of the date of termination of employment and had not previously been exercised; provided, however: (i) if Optionee is permanently disabled (within the meaning of Section 22(e)(3) of the Code) at the time of termination, the foregoing three (3) month period shall be extended to six (6) months; or (ii) if Optionee is terminated “for cause” or by the terms of the Plan or this Option Agreement or by any employment agreement between the Optionee and the Company, this Option shall automatically terminate as to all Shares covered by this Option not exercised prior to termination. Unless earlier terminated, all rights under this Option shall terminate in any event on the expiration date of this Option as defined in Section 4 hereof.

8. Death of Optionee. If the Optionee shall die while in the employ of the Company, Optionee’s personal representative or the person entitled to Optionee’s rights hereunder may at any time within six (6) months after the date of Optionee’s death, or during the remaining term of this Option, whichever is the lesser, exercise this Option and purchase Shares to the extent, but only to the extent, that Optionee could have exercised this Option as of the date of Optionee’s death provided, in any case, that this Option may be so exercised only to the extent that this Option has not previously been exercised by Optionee.

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9. No Rights as Shareholder. Optionee shall have no rights as a shareholder with respect to the Shares covered by any installment of this Option until the effective date of issuance of Shares following exercise of this Option, and no adjustment will be made for dividends or other rights for which the record date is prior to the date such stock certificate or certificates are issued except as provided in Section 10 hereof.

10. Recapitalization. Subject to any required action by the shareholders of the Company, the number of Shares covered by this Option, and the Exercise Price thereof, shall be proportionately adjusted for any increase or decrease in the number of issued shares resulting from a subdivision or consolidation of shares or the payment of a stock dividend, or any other increase or decrease in the number of such shares effected without receipt of consideration by the Company; provided however that the conversion of any convertible securities of the Company shall not be deemed having been “effected without receipt of consideration by the Company”.

In the event of a proposed dissolution or liquidation of the Company, a merger or consolidation in which the Company is not the surviving entity, or a sale of all or substantially all of the assets or capital stock of the Company (collectively, a “Reorganization”), unless otherwise provided by the Board, this Option shall terminate immediately prior to such date as is determined by the Board, which date shall be no later than the consUll1ffiation of such Reorganization. In such event, if the entity which shall be the surviving entity does not tender to Optionee an offer, for which it has no obligation to do so, to substitute for any unexercised Option a stock option or capital stock of such surviving of such surviving entity, as applicable, which on an equitable basis shall provide the Optionee with substantially the same economic benefit as such unexercised Option, then the Board may grant to such Optionee, in its sole and absolute discretion and without obligation, the right for a period commencing thirty (30) days prior to and ending immediately prior to the date determined by the Board pursuant hereto for termination of the Option or during the remaining term of the Option, whichever is the lesser, to exercise any unexpired Option or Options without regard to the installment provisions of Section 5; provided, however, that such exercise shall be subject to the consummation of such Reorganization.

Subject to any required action by the shareholders of the Company, if the Company shall be the surviving entity in any merger or consolidation, this Option thereafter shall pertain to and apply to the securities to which a holder of Shares equal to the Shares subject to this Option would have been entitled by reason of such merger or consolidation, and the installment provisions of Section 5 shall continue to apply.

In the event of a change in the shares of the Company as presently constituted, which is limited to a change of all of its authorized Stock without par value into the same number of shares of Stock with a par value, the shares resulting from any such change shall be deemed to be the Shares within the meaning of this Option.

To the extent that the foregoing adjustments relate to shares or securities of the Company, such adjustments shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as hereinbefore expressly provided, Optionee shall have no rights by reason of any subdivision or consolidation of shares of Stock of any class or the payment of any stock dividend or any other increase or decrease in the number of shares of stock of any class, and the number and price of Shares subject to this Option shall not be affected by, and no adjustments shall be made by reason of, any dissolution, liquidation, merger, consolidation or sale of assets or capital stock, or any issue by the Company of shares of stock of any class or securities convertible into shares of stock of any class.

The grant of this Option shall not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes in its capital or business structure or to merge, consolidate, dissolve or liquidate or to sell or transfer all or any part of its business or assets.

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11. Additional Consideration. Should the Internal Revenue Service determine that the Exercise Price established by the Board as the fair market value per Share is less than the fair market value per Share as of the date of Option grant, Optionee hereby agrees to tender such additional consideration, or agrees to tender upon exercise of all or a portion of this Option, such fair market value per Share as is determined by the Internal Revenue Service.

12. Modifications, Extension and Renewal of Options. The Board or Committee, as described in the Plan, may modify, extend or renew this Option or accept the surrender thereof (to the extent not theretofore exercised) and authorize the granting of a new option in substitution therefore (to the extent not theretofore exercised), subject at all times to the Plan, and Section 422 of the Code. Notwithstanding the foregoing provisions of this Section 12, no modification shall, without the consent of the Optionee, alter to the Optionee’s detriment or impair any rights of Optionee hereunder.

13. Investment Intent; Restrictions on Transfer.

(a) Optionee represents and agrees that if Optionee exercises this Option in whole or in  art, Optionee will in each case acquire the Shares upon such exercise for the purpose of  investment and not with a view to, or for resale in connection with, any distribution thereof; and that upon such exercise of this Option in whole or in part, Optionee (or any person or persons entitled to exercise this Option under the provisions of Sections 7 and 8 hereof) shall furnish to the Company a written statement to such effect, satisfactory to the Company in form and substance. If the Shares represented by this Option are registered under the Securities Act, either before or after the exercise of this Option in whole or in part, the Optionee shall be relieved of the foregoing investment representation and agreement and shall not be required to furnish the Company with the foregoing written statement.

(b) Optionee further represents that Optionee has had access to the financial statements or books and records of the Company, has had the opportunity to ask questions of the Company concerning its business, operations and financial condition, and to obtain additional information reasonably necessary to verify the accuracy of such information.

(c) Unless and until the Shares represented by this Option are registered under the Securities Act, all certificates representing the Shares and any certificates subsequently issued in substitution therefore and any certificate for any securities issued pursuant to any stock split, share reclassification, stock dividend or other similar capital event shall bear legends in substantially the following form:

THESE SECURITIES HAVE NOT BEEN REGISTERED OR OTHERWISE QUALIFIED UNDER THE SECURITIES ACT OF 1933 (THE ’SECURITIES ACT’) OR UNDER THE APPLICABLE OR SECURITIES LAWS OF ANY STATE. NEITHER THESE SECURITIES NOR ANY INTEREST THEREIN MAYBE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE SECURITIES LAWS OF ANY STATE, UNLESS PURSUANT TO EXEMPTIONS THEREFROM.

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED PURSUANT TO THAT CERTAIN INCENTIVE STOCK OPTION AGREEMENT DATED BETWEEN THE COMPANY AND THE ISSUEE WHICH RESTRICTS THE TRANSFER OF THESE SHARES WHICH ARE SUBJECT TO REPURCHASE BY THE COMPANY UNDER CERTAIN CONDITIONS.

Such other legend or legends as the Company and its counsel deem necessary or appropriate. Appropriate stop transfer instructions with respect to the Shares have been placed with the Company’s transfer agent.

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14. Effects of Early Disposition. Optionee understands that if an Optionee disposes of shares acquired hereunder within two (2) years after the date of this Option or within one (1) year after the date of issuance of such shares to Optionee, such Optionee will be treated for income tax purposes as having received ordinary income at the time of such disposition of an amount generally measured by the difference between the purchase price and the fair market value of such stock on the date of exercise, subject to adjustment for any tax previously paid, in addition to any tax on the difference between the sales price and Optionee’s adjusted cost basis in such shares. The foregoing amount may be measured differently if Optionee is an officer, director or ten percent holder of the Company. Optionee agrees to notify the Company within ten (10) working days of any such disposition.

15. Stand-off Agreement. Optionee agrees that in connection with any registration of the Company’s securities under the Securities Act, and upon the request of the Company or any underwriter managing an underwritten offering of the Company’s securities, Optionee shall not sell, short any sale of, loan, grant an option for, or otherwise dispose of any of the Shares (other than Shares included in the offering) without the prior written consent of the Company or such managing underwriter, as applicable, for a period of at least one year following the effective date of registration of such offering.

16. Restriction Upon Transfer. The Shares may not be sold, transferred or otherwise disposed of and shall not be pledged or otherwise hypothecated by the Optionee except as hereinafter provided.

(a) Repurchase Right on Termination Other Than for Cause. For the purposes of this Section, a “Repurchase Event” shall mean an occurrence of one of (i) termination of Optionee’s employment by the Company, voluntary or involuntary and with or without cause; (ii) retirement or death of Optionee; (iii) bankruptcy of Optionee, which shall be deemed to have occurred as of the date on which a voluntary or involuntary petition in bankruptcy is filed with a court of competent jurisdiction; (iv) dissolution of the marriage of Optionee, to the extent that any of the Shares are allocated as the sole and separate property of Optionee’s spouse pursuant thereto (in which case this Section shall only apply to the Shares so affected); or (v) any attempted transfer by the Optionee of Shares, or any interest therein, in violation of this Agreement. Upon the occurrence of a Repurchase Event, the Company shall have the right (but not an obligation) to repurchase all or any portion of the Shares of Optionee at a price equal to the fair value of the Shares as of the date of the Repurchase Event.

(b) Repurchase Right on Termination for Cause. In the event Optionee’s employment is terminated by the Company “for cause”, then the Company shall have the right (but not an obligation) to repurchase Shares of Optionee at a price equal to the Exercise Price. Such right of the Company to repurchase Shares shall apply to 100% of the Shares for one (1) year from the date of this Agreement; and shall thereafter lapse at the rate of twenty percent (20%) of the Shares on each anniversary of the date of this Agreement. In addition, the Company shall have the right, in the sole discretion of the Board and without obligation, to repurchase upon termination for cause all or any portion of the Shares of Optionee, at a price equal to the fair value of the Shares as of the date of termination, which right is not subject to the foregoing lapsing of rights. In the event the Company elects to repurchase the Shares, the stock certificates representing the same shall forthwith be returned to the Company for cancellation.

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(c) Exercise of Repurchase Right. Any Repurchase Right under Paragraphs l6(a) or l6(b) shall be exercised by giving notice of exercise as provided herein to Optionee or the estate of Optionee, as applicable. Such right shall be exercised, and the repurchase price thereunder shall be paid, by the Company within a ninety (90) day period beginning on the date of notice to the Company of the occurrence of such Repurchase Event (except in the case of termination of employment or retirement, where such option period shall begin upon the occurrence of the Repurchase Event). Such repurchase price shall be payable only in the form of cash (including a check drafted on immediately available funds) or cancellation of purchase money indebtedness of the Optionee for the Shares. If the Company can not purchase all such Shares because it is unable to meet the financial tests set forth in Texas corporation law, the Company shall have the right to purchase as many Shares as it is permitted to purchase under such sections. Any Shares not purchased by the Company hereunder shall no longer be subject to the provisions of this Section 16.

(d) Right of First Refusal. In the event Optionee desires to transfer any Shares during his or her lifetime, Optionee shall first offer to sell such Shares to the Company.  Optionee shall deliver to the Company written notice of the intended sale, such notice to specify the number of Shares to be sold, the proposed purchase price and terms of payment, and grant the Company an option for a period of thirty days following receipt of such notice to purchase the offered Shares upon the same terms and conditions. To exercise such option, the Company shall give notice of that fact to Optionee within the thirty (30) day notice period and agree to pay the purchase price in the manner provided in the notice. If the Company does not purchase all of the Shares so offered during foregoing option period, Optionee shall be under no obligation to sell any of the offered Shares to the Company, but may dispose of such Shares in any lawful manner during a period of one hundred and eighty (180) days following the end of such notice period, except that Optionee shall not sell any such Shares to any other person at a lower price or upon more favorable terms than those offered to the Company.

(e) Acceptance of Restrictions. Acceptance of the Shares shall constitute the Optionee’s agreement to such restrictions and the legending of his certificates with respect thereto. Notwithstanding such restrictions, however, so long as the Optionee is the holder of the Shares, or any portion thereof, he shall be entitled to receive all dividends declared on and to vote the Shares and to all other rights of a shareholder with respect thereto.

(f) Permitted Transfers. Notwithstanding any provisions in this Section 16 to the contrary, the Optionee may transfer Shares subject to this Agreement to his or her parents, spouse, children, or grandchildren, or a trust for the benefit of the Optionee or any such transferee(s); provided, that such permitted transferee(s) shall hold the Shares subject to all the provisions of this Agreement (all references to the Optionee herein shall in such cases refer mutatis mutandis to the permitted transferee, except in the case of clause (iv) of Section 16(a) wherein the permitted transfer shall be deemed to be rescinded); and provided further, that notwithstanding any other provisions in this Agreement, a permitted transferee may not, in turn, make permitted transfers without the written consent of the Optionee and the Company.

(g) Release of Restrictions on Shares. All other restrictions under this Section 16 shall terminate five (5) years following the date of this Agreement, or when the Company’s securities are publicly traded, whichever occurs earlier.

17. Notices. Any notice required to be given pursuant to this Option or the Plan shall be in writing and shall be deemed to be delivered upon receipt or, in the case of notices by the Company, five (5) days after deposit in the U.S. mail, postage prepaid, addressed to Optionee at the address last provided to the Company by Optionee for his or her employee records.

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18. Agreement Subject to Plan; Applicable Law. This Option is made pursuant to the Plan and shall be interpreted to comply therewith. A copy of such Plan is available to Optionee, at no charge, at the principal office of the Company. Any provision of this Option inconsistent with the Plan shall be considered void and replaced with the applicable provision of the Plan. This Option has been granted, executed and delivered in the State of Texas, and the interpretation and enforcement shall be governed by the laws thereof and subject to the exclusive jurisdiction of the courts therein.

IN WITNESS WHEREOF, the parties hereto have executed this Option as of the date first above written.

COMPANY: CORNERWORLD CORPORATION
an Nevada corporation



By: __/s/Scott N. Beck___________

Name: _Scott N. Beck___________

Title: ___CEO_________________

OPTIONEE:

By: __/s/ Marc A. Pickren________
       (signature)

Name: __Marc A. Pickren________

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Appendix A

NOTICE OF EXERCISE

CORNERWORLD CORPORATION

_________________

_________________

_________________

Re: Incentive Stock Option

1) Notice is hereby given pursuant to Section 6 of my Incentive Stock Option Agreement that I elect to purchase the number of shares set forth below at the exercise price set forth in my option agreement:

Incentive Stock Option Agreement dated: _

Number of shares being purchased: _

Exercise Price: $, _

A check in the amount of the aggregate price of the shares being purchased is attached.

OR

2) I elect a cashless exercise pursuant to Section 6 of my Incentive Stock Option. The Average Market Price as of ____ was $____.

I hereby confirm that such shares are being acquired by me for my own account for investment purposes, and not with a view to, or for resale in connection with, any distribution thereof. I will not sell or dispose of my Shares in violation of the Securities Act of 1933, as amended, or any applicable federal or state securities laws. Further, I understand that the exemption from taxable income at the time of exercise is dependent upon my holding such stock for a period of at least one year from the date of exercise and two years from the date of grant of the Option.

I understand that the certificate representing the Option Shares will bear a restrictive legend within the contemplation of the Securities Act and as required by such other state or federal law or regulation applicable to the issuance or delivery of the Option Shares.

I agree to provide to the Company such additional documents or information as may be required pursuant to the Company’s 2007 Incentive Stock Plan.

By:      _______________________________

(signature)

Name:  ______________________________

- 8 -

EX-31

Exhibit 31.1

CERTIFICATION

I, Scott N. Beck, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CornerWorld Corporation;

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

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

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Scott N. Beck

Scott N. Beck

Chief Executive Officer

Date: December 20, 2011

EX-31

Exhibit 31.2

CERTIFICATION

I, V. Chase McCrea III, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CornerWorld Corporation;

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

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

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ V. Chase McCrea III

V. Chase McCrea III

Chief Financial Officer

Date: December 20, 2011

EX-32

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, Scott N. Beck, hereby certifies, for purposes of section 1350 of chapter 63 of title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in his capacity as the Chief Executive Officer of CornerWorld Corporation (the “Company”) that, to his knowledge, the Quarterly Report of the Company on Form 10-Q for the period ended October 31, 2011, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company. A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

/s/ Scott N. Beck

Scott N. Beck

Chief Executive Officer

Dated: December 20, 2011

EX-32

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, V. Chase McCrea III, hereby certifies, for purposes of section 1350 of chapter 63 of title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in his capacity as the Chief Financial Officer of CornerWorld Corporation (the “Company”) that, to his knowledge, the Quarterly Report of the Company on Form 10-Q for the period ended October 31, 2011, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company. A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

/s/ V. Chase McCrea III

V. Chase McCrea III

Chief Financial Officer

Dated: December 20, 2011

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Intangible Assets

6 Months Ended

Oct. 31, 2011

Intangible Assets [Abstract]

Intangible Assets

3. Intangible Assets

Identifiable intangibles acquired in connection with business acquisitions accounted for under the purchase method are recorded at their respective fair values. The Company is amortizing the identifiable intangibles over their estimated useful lives, ranging from three to seven years. Intangibles consist of the following:

	October 31, 2011			April 30, 2011			Estimated Useful Life (Years)
Patent	$	10,904,792		$	10,904,792			7
Customer list		1,000,000			1,000,000			3
		11,904,792			11,904,792
Accumulated amortization		(5,154,208	)		(4,264,190	)
	$	6,750,584		$	7,640,602

Amortization expense related to identifiable intangible assets totaled $417,227 and $472,791 for the three month periods ended October 31, 2011 and 2010, respectively, and $890,018 and $945,582 for the six month periods ended October 31, 2011 and 2010, respectively.

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Summary of Significant Accounting Policies

6 Months Ended

Oct. 31, 2011

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

This summary of significant accounting policies is presented to assist in understanding the Company's condensed consolidated financial statements. The condensed consolidated financial statements and notes are representations of the Company's management who is responsible for their integrity and objectivity. These accounting policies conform to US GAAP and have been consistently applied in the preparation of the financial statements. The financial statements are stated in United States of America dollars.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of the contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates made by management include, among others, the realizability of accounts receivable, recoverability of property and equipment, intangibles and goodwill and valuation of stock-based compensation and deferred tax assets. Actual results could differ from these estimates.

Fair Value of Financial Instruments

Accounting Standards Codification ("ASC") No. 850 requires disclosure of fair value information about financial instruments when it is practicable to estimate that value. The carrying amount of the Company's cash and cash equivalents, accounts receivable, accounts receivable-related party, accounts payable, accounts payable-related party, accrued liabilities, and notes payable approximate their estimated fair values due to their short-term maturities.

Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements.

Revenue Recognition

The Company recognizes revenue in accordance with Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial Statements," as revised by SAB 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable and collectibility is probable. Sales are recorded net of sales discounts.

At Enversa, revenue is recognized along with the related cost of revenue as leads are delivered. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. Amounts billed to clients in advance of delivery of leads are classified under current liabilities as deferred revenue. At Gulf, revenue is recognized monthly as SEO services are provided or in the form of revenues from domain leases.

For Woodland Wireless, the majority of revenue is derived from month-to-month, bundled service contracts for the phone, television and internet services used by each customer. Revenue is recognized as the services are provided.

Income Taxes

The Company accounts for income tax in accordance with ASC No. 740 which requires the use of the asset and liability method of accounting of income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Long-Lived Assets

The Company accounts for its long-lived assets in accordance with the ASC. The Company's primary long-lived assets are website development costs, Goodwill, a patent, identifiable intangible assets and property and equipment. The ASC requires a company to assess the recoverability of its long-lived assets whenever events and circumstances indicate the carrying value of an asset or asset group may not be recoverable from estimated future cash flows expected to result from its use and eventual disposition. Management does not believe the Goodwill, patent and identifiable intangible assets associated with its recent acquisitions are impaired. No impairment charges have been recorded as of October 31, 2011.

Stock-Based Compensation

The Company accounts for awards made under its two stock-based compensation plans pursuant to the fair value provisions of ASC No. 718. ASC No. 718 requires the recognition of stock-based compensation expense, using a fair-value based method, for costs related to all share-based payments including stock options. ASC No. 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The Company accounts for stock-based compensation in accordance with ASC No. 718 and estimates its fair value based on using the Black-Scholes option pricing model.

The Company's determination of fair value of share-based payment awards is made as of their respective dates of grant using that option pricing model and is affected by the Company's stock price as well as a number of subjective assumptions. These variables include, but are not limited to, the Company's expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behavior. The expected term of options granted is derived from historical data on employee exercises and post-vesting employment termination behavior. The risk-free rate selected to value any particular grant is based on the U.S. Treasury rate that corresponds to the pricing term of the grant effective as of the date of the grant. The expected volatility is based on the historical volatility of the Company's stock price. These factors could change in the future, affecting the determination of stock-based compensation expense in future periods. The Black-Scholes option pricing model was developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because the Company's options have certain characteristics that are significantly different from traded options, the existing valuation models may not provide an accurate measure of the fair value of the Company's options. Although the fair value of the Company's options is determined in accordance with ASC No. 718 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. The calculated compensation cost is recognized on a straight-line basis over the vesting period of the options. See also Note 6 Stock Based Compensation, for more details.

Reclassifications

Certain prior year accounts have been reclassified to conform to the current year's presentation.

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Condensed Consolidated Balance Sheets (USD $)	Oct. 31, 2011	Apr. 30, 2011
Current assets:
Cash	$ 580,347	$ 934,250
Accounts receivable (net of allowance for doubtful accounts of $94,516 and $48,936 at October 31, 2011 and April 30, 2011, respectively)	2,053,233	1,777,704
Prepaid expenses and other current assets	93,772	112,972
Total current assets	2,727,352	2,824,926
Property and equipment, net	281,499	478,536
Goodwill	2,136,836	2,136,836
Patent	6,750,584	7,529,498
Intangibles, net		111,104
Other assets	28,410	28,132
TOTAL ASSETS	11,924,681	13,109,032
Current liabilities:
Accounts payable	2,216,295	2,962,995
Accrued expenses	769,013	600,726
Notes payable, current portion, net of unamortized discount of $326,523 and $316,516 at October 31, 2011 and April 30, 2011, respectively	558,793	543,484
Notes payable related parties, current portion, net of unamortized discount of $326,984 and $402,824 at October 31, 2011 and April 30, 2011, respectively	1,102,189	1,444,145
Deferred revenue	700,589	460,415
Total current liabilities	5,346,879	6,011,765
Long-term liabilities:
Notes payable, net of current portion, net of unamortized discount of $703,901 and $880,916 at October 31, 2011 and April 30, 2011, respectively	4,986,099	5,059,084
Notes payable related parties, net of current portion, net of unamortized discount of $53,613 and $280,149 at October 31, 2011 and April 30, 2011, respectively	2,548,286	2,134,254
Other liabilities	700,563	642,899
Total liabilities	13,581,827	13,848,002
Commitments and Contingencies
Stockholders' deficit:
Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding
Common stock, $0.001 par value, 250,000,000 shares authorized; 147, 547,607 and 146,972,901 shares issued and outstanding, at October 31, 2011 and April 30, 2011	147,547	146,972
Additional paid-in capital	10,081,102	10,006,785
Retained earnings (accumulated deficit)	(11,885,795)	(10,892,727)
Total stockholders' deficit	(1,657,146)	(738,970)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 11,924,681	$ 13,109,032

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Condensed Consolidated Statements of Cash Flows (USD $)	6 Months Ended
	Oct. 31, 2011	Oct. 31, 2010
Cash Flows from Operating Activities
Net loss	$ (993,068)	$ (402,863)
Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation and amortization	1,095,756	1,132,183
Amortization of discount on debt	469,384
Provision for doubtful accounts	136,457	27,445
Stock-based compensation	74,892	74,627
Changes in operating assets and liabilities, net of acquisitions and divestitures:
Accounts receivable	(411,986)	(6,905)
Prepaid expenses and other current assets	19,200	40,266
Goodwill
Other assets	(278)	3,057
Accounts payable	(746,700)	(310,053)
Accrued expenses	230,787	86,401
Deferred revenue	240,174	(26,707)
Other liabilities	57,664	308,647
Net cash provided by operating activities	172,282	926,098
Cash Flows from Investing Activities
Proceeds from sale of fixed assets	5,900
Purchases of property and equipment	(14,601)	(19,530)
Net cash used in investing activities	(8,701)	(19,530)
Cash Flows from Financing Activities
Fees paid for debt issuance	(62,500)
Principal payments on related party notes payable	(204,984)	(660,000)
Payments on related party line of credit		(150,000)
Principal payments on debt	(250,000)
Net cash used in financing activities	(517,484)	(810,000)
Net increase (decrease) in cash	(353,903)	96,568
Cash at beginning of period	934,250	590,163
Cash at end of period	580,347	686,731
Cash paid for:
Interest	717,657	507,770
Income taxes

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Basis of Presentation

6 Months Ended

Oct. 31, 2011

Basis of Presentation [Abstract]

Basis of Presentation

1. Basis of Presentation

Interim Unaudited Condensed Consolidated Financial Statements

The unaudited interim condensed consolidated financial statements of CornerWorld Corporation ("CornerWorld" or the "Company") as of October 31, 2011 and for the three and six month periods ended October 31, 2011 and 2010 contained in this Quarterly Report (collectively, "the Unaudited Interim Condensed Consolidated Financial Statements") were prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) for all periods presented. The results of operations for the three and six month periods ended October 31, 2011 are not necessarily indicative of the results that may be expected for the entire fiscal year.

The accompanying Unaudited Interim Condensed Consolidated Financial Statements have been prepared in accordance with the regulations for interim financial information of the Securities and Exchange Commission (the "SEC"). Accordingly, they do not include all of the disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited accompanying statements of financial condition and related interim statements of operations, cash flows, and stockholders' deficit include all adjustments (which consist only of normal and recurring adjustments) considered necessary for a fair presentation in conformity with U.S. GAAP. These Unaudited Interim Condensed Consolidated Financial Statements should be read in conjunction with the Company's consolidated financial statements as of and for the year ended April 30, 2011, as filed with the SEC on Form 10-K, and the unaudited interim condensed consolidated financial statements as of and for the period ended July 31, 2011, as filed with the SEC on Form 10-Q.

Organization

The Company was incorporated in the State of Nevada, on November 9, 2004 as Olympic Weddings International, Inc. Effective May 1, 2007, we changed our name to CornerWorld Corporation.

The Company entered into a Share Exchange Agreement and Plan of Merger (the "Agreement") with Enversa Companies LLC, a Texas limited liability company ("Enversa"), Leadstream LLC, a Texas limited liability company ("Leadstream"), and the holders of the membership interests of Leadstream on August 27, 2008. Pursuant to the Agreement, on August 27, 2008, Leadstream merged with and into Enversa (the "Merger"), of which CornerWorld is the sole member. Enversa was the surviving company in the merger and, as such, acquired all right, title and interest in and to all real estate and other property of Leadstream and became responsible for all liabilities and obligations of Leadstream and Enversa.

Enversa  is a technology-oriented direct response marketing company. Using its proprietary technology, Enversa identifies qualified leads for advertisers thereby connecting them with potential consumers. Enversa utilizes a pay-for-performance pricing model which is very appealing to clients because it ensures that they are billed solely for campaign performance. Enversa also operates several ad networks and a proprietary request for proposal (RFP) technology that highlights promotional offers from a variety of corporate clients.   Finally, Enversa's Gulf Media Solutions, LLC ("Gulf") subsidiary, provides search engine optimization services ("SEO"), domain leasing and website management services on a recurring monthly basis to over 300 customers.

On February 23, 2009, the Company completed its acquisition (the "Woodland Acquisition") of all of the issued and outstanding equity interests of each of Woodland Wireless Solutions, Ltd. ("Woodland Wireless"), West Michigan Co-Location Services, L.L.C. ("WMCLS") and T2 TV, L.L.C. ("T2 TV"), and forty voting member units of S Squared, LLC, doing business in the state of Michigan as "Ranger Wireless LLC" ("Ranger"), through its newly-formed wholly-owned subsidiary, Woodland Holdings Corp. ("Woodland Holdings"), pursuant to the terms of a Stock Purchase Agreement, dated February 23, 2009 (the "Effective Date"), by and among Woodland Holdings, the Company, Ned B. Timmer and HCC Foundation ("HCC Foundation"). Immediately following the Woodland Acquisition, the forty voting member units of Ranger that were purchased by Woodland Holdings were contributed to Woodland Wireless and all other issued and outstanding voting member units of Ranger remained held by Woodland Wireless.

As a result of the Woodland Acquisition, Ranger became a wholly-owned subsidiary of Woodland Wireless. In addition, pursuant to a Unit Purchase Agreement (the "Unit Purchase Agreement") entered into on the Effective Date among Woodland Holdings, Phone Services and More, L.L.C., doing business as Visitatel ("PSM"), T2 Communications, L.L.C. ("T2 Communications") and Ned B. Timmer, Woodland Holdings agreed to purchase all of the outstanding voting member units of each of PSM and T2 Communications, for an aggregate purchase price of $300,000. Final consummation of the transactions contemplated by the Unit Purchase Agreement took place on March 30, 2011. Prior to March 30, 2011, the Company accounted for PSM and T2 Communications as Variable Interest Entities ("VIE's") and consolidated them for accounting purposes.

Subsequent to the closing of the Unit Purchase Agreement, the Company slightly adjusted the manner in which it managed the assets acquired in the Woodland Acquisition; these assets comprise 100% of the Company's Communication Services Segment. As a result of the closing of the Unit Purchase Agreement, Woodland Wireless, Ranger and WMCLS are collectively referred to herein as the "Ranger Wireless Group". T2 Communications, T2TV and PSM are collectively referred to herein as the "T2 Group".

RANGER® is a shortcode application service provider to the wireless industry. The core service offered is 611 Roaming Service™, a patented application providing seamless means for connecting wireless subscribers to reach their home providers customer service call center while roaming on another provider's network. Calls are sent to RANGER® for treatment from nearly 40 wireless providers throughout North America. On an annual basis, RANGER® processes approximately 14 million calls with an infrastructure capable of handling millions more. RANGER® also manages an online portal which allows carriers access to their monthly statements and reporting on call volume to and from their company.

As a provider of Internet Protocol Television (IPTV), Internet and VoIP services, T² Communications delivers leading-edge technology to residential and business customers in Michigan. Offerings include: phone lines, Internet connections, 275 all-digital television stations, colocation, long distance and toll-free services. T² Communications is a Competitive Local Exchange Carrier (CLEC) that manages its own Fiber to the Premise (FTTP) network with a 10 gigabit backbone and up to 1 gigabit per second connections to end users.

PSM holds an FCC 214 License as a wholesale long distance service provider to the carrier community and large commercial users of transport minutes. Serving service providers, WMCLS offers telecommunications equipment storage and leasing.

The Company's year-end is April 30^th.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and joint ventures as well as all entities deemed to qualify as VIE's. All significant intercompany transactions and balances have been eliminated in consolidation.

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Oct. 31, 2011	Apr. 30, 2011
Accounts receivable, allowance for doubtful accounts	$ 94,516	$ 48,936
Preferred stock, par value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value per share	$ 0.001	$ 0.001
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	147,547,607	146,972,901
Common stock, shares outstanding	147,547,607	146,972,901
Current Notes Payable [Member]
Notes payable, unamortized discount	326,523	316,516
Current Notes Payable, Related Parties [Member]
Notes payable, unamortized discount	326,984	402,824
Long-Term Notes Payable [Member]
Notes payable, unamortized discount	703,901	880,916
Long-Term Notes Payable, Related Parties [Member]
Notes payable, unamortized discount	$ 53,613	$ 280,149

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Document and Entity Information	6 Months Ended
	Oct. 31, 2011	Dec. 15, 2011
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Oct. 31, 2011
Entity Registrant Name	Cornerworld Corp
Entity Central Index Key	0001338242
Current Fiscal Year End Date	--04-30
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		147,547,607

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Condensed Consolidated Statements of Operations (USD $)	3 Months Ended		6 Months Ended
	Oct. 31, 2011	Oct. 31, 2010	Oct. 31, 2011	Oct. 31, 2010
Condensed Consolidated Statements of Operations [Abstract]
Sales, net	$ 2,914,058	$ 2,950,294	$ 5,855,731	$ 5,827,896
Costs of goods sold	728,924	914,778	1,580,421	1,943,162
Gross profit	2,185,134	2,035,516	4,275,310	3,884,734
Expenses:
Selling, general and administrative expenses	1,619,189	1,708,213	2,955,200	3,129,617
Depreciation and amortization	518,505	564,183	1,095,756	1,132,183
Total Operating expenses	2,137,694	2,272,396	4,050,956	4,261,800
Operating income (loss)	47,440	(236,880)	224,354	(377,066)
Other income (expense), net:
Interest expense	(581,100)	(247,929)	(1,277,082)	(507,440)
Other income (expense), net	62,252	63,208	59,660	481,643
Total other expense, net	(518,848)	(184,721)	(1,217,422)	(25,797)
Loss before income taxes	(471,408)	(421,601)	(993,068)	(402,863)
Income taxes
Net loss	$ (471,408)	$ (421,601)	$ (993,068)	$ (402,863)
Basic and diluted loss per share	$ 0.0	$ 0.0	$ (0.01)	$ 0.0
Basic and diluted weighted average number shares outstanding	147,207,875	95,518,317	147,090,388	95,518,317

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Stock-Based Compensation

6 Months Ended

Oct. 31, 2011

Stock-Based Compensation [Abstract]

Stock-Based Compensation

6. Stock-Based Compensation

Incentive Stock Plan

On August 17, 2007, the Company's board of directors adopted and implemented the Company's 2007 Incentive Stock Plan. Under the Incentive Stock Plan, the Company is authorized to issue 4,000,000 shares of its common stock to the Company's directors, officers, employees, advisors or consultants.

Any Incentive Stock Option granted to an employee of the Company shall become exercisable over a period of no longer than 5 years, and no less than 20% of the shares covered thereby shall become exercisable annually. 20% of shares vest annually beginning on the first anniversary of the grant. The options expire 10 years from the grant date.

The Company issued 955,000 stock options at a weighted average exercise price of $0.30/share pursuant to this plan during the six months ended October 31, 2011.

Stock Compensation Plan

On August 17, 2007, the Company's board of directors adopted and implemented the Company's 2007 Stock Compensation Plan. The total number of shares of the Company's common stock which may be purchased or granted directly by Options, Stock Awards or Warrants under the Compensation Plan shall not exceed 4,000,000 shares of the Company's common stock.

Awards granted to a participant of the Company shall become exercisable over a period of no longer than 5 years, and may vest as determined at the Company's discretion at the time of grant.

The Company issued no stock options pursuant to this plan during the six months ended October 31, 2011.

A summary of the shares reserved for grant and awards available for grant under each Stock Plan is as follows:

	October 31, 2011
	Shares Reserved for Grant		Awards Available for Grant
Incentive Stock Plan		4,000,000		1,705,000
Stock Compensation Plan		4,000,000		3,150,000
		8,000,000		4,855,000

The Company issues awards to employees, qualified consultants and directors that generally vest over time based solely on continued employment or service during the related vesting period and are exercisable over a five to ten year service period. Options are generally granted with an exercise price equal to the market price of the Company's stock at the date of grant.

The fair value of each stock-based award is estimated on the grant date using the Black-Scholes option-pricing model. Expected volatilities are based on the historical volatility of the Company's stock price. The expected term of options granted subsequent to the adoption of ASC No. 718 is derived using the simplified method as defined in the SEC's SAB No. 107. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury interest rates in effect at the time of grant. The fair value of options granted was estimated using the following weighted-average assumptions:

	For the three month periods Ended October 31				For the six month periods Ended October 31
	2011		2010		2011		2010
Expected term (in years)	5.0		5.0		5.0		5.0
Expected volatility	99.1	%	99.1	%	99.1	%	99.1	%
Risk-free interest rate	1.0	%	2.3	%	1.0	%	2.3	%
Dividend yield	0.0	%	0.0	%	0.0	%	0.0	%

A summary of activity under the Stock Plans and changes during the period ended October 31, 2011 is presented below:

	Weighted-Average
	Shares			Exercise Price		Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding at May 1, 2011		2,520,000		$	0.35		3.36	$	0
Issued		955,000		$	0.30		5.00	$	0
Cancelled/forfeited		(270,179	)		0.20
Exercised		(59,821	)		0.20
Outstanding at October 31, 2011		3,145,000		$	0.34		3.31	$	47,600
Options vested and expected to vest*		2,965,000		$	0.35		3.25	$	22,300
Options exercisable at end of period		1,316,250		$	0.40		2.33	$	22,300

* Due to the Company's limited operating history, no estimate for forfeitures has been made in these financial statements as there has been no turnover of employees to whom options were granted.

For the three month periods ended October 31, 2011 and 2010, the Company recognized $37,446 and $37,371 of stock-based compensation expense, respectively, and for the six month periods ended October 31, 2011 and 2010, the Company recognized $74,892 and $74,627 of stock-based compensation expense, respectively. As of October 31, 2011 there was $398,303 of total unrecognized compensation cost, net of forfeitures, related to unvested employee and director stock option compensation arrangements. That cost is expected to be recognized on a straight-line basis over the next 3.31 weighted average years.

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Commitments and Contingencies

6 Months Ended

Oct. 31, 2011

Commitments and Contingencies [Abstract]

Commitments and Contingencies

5. Commitments and Contingencies

Litigation

The Company is occasionally involved in litigation matters relating to claims arising from the ordinary course of business. The Company's management believes that there are no claims or actions pending or threatened against the Company, the ultimate disposition of which would have a material adverse effect on our business, results of operations and financial condition.

Employment Agreements

On July 28, 2011, the Company entered into an employment agreement with Mr. Scott Beck, its Chairman and CEO. Pursuant to his employment agreement, Mr. Beck is paid an annual base salary of $400,000, an annual performance based cash bonus subject to the discretion of the Board of Directors, an annual warrant to purchase 1% of the then outstanding common shares of the Company, a bonus fee of 2.00% of all equity and debt raised during the time of his contract, a 3.50% fee for the transaction value of all acquisitions as defined in his employment agreement, warrants equal to 3.25% of the equity issued pursuant to any debt and equity raised during the time of his employment agreement, a warrant equal to 3.25% of the transaction value of any equity issued in association with all acquisitions and the greater of 5% of fair market value or $5.0 million buyout fee in the case of a change in control; in addition, Mr. Beck's employment agreement provides for an annual increase of Mr. Beck's base salary by 5% every year during the term of the agreement. Mr. Beck's employment agreement also provides that, if he is terminated without cause prior to the end of the employment agreement, he will be paid the full amount of his base salary for any days remaining in the full ten year term, the Company will purchase all equity instruments held by Mr. Beck and, finally, the Company will pay Mr. Beck $5.0 million within six months of his termination. Finally, Mr. Beck will receive 10% of amounts payable to the Company as a result of any patent infringement litigation. Mr. Beck's employment agreement continues through July 27, 2021.

On September 13, 2011, the Company entered into an employment agreement with Mr. Marc Pickren, its President. Pursuant to his employment agreement, Mr. Pickren is paid an annual base salary of $220,000 and commissions based on new clients acquired by Mr. Pickren. Mr. Pickren was paid a one-time signing bonus of $55,000 related to entering into this agreement. In addition, in accordance with his employment agreement, on September 21, 2011, Mr. Pickren was issued 250,000 options to purchase the Company's common stock at a price of $0.30 per share; the option contains vesting provisions consistent with other options issued to employees and expires at the end of 5 years. Mr. Pickren's employment agreement continues through September 15, 2013.

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Business Segments

6 Months Ended

Oct. 31, 2011

Business Segments [Abstract]

Business Segments

7. Business Segments

Our business consists primarily of two integrated business segments: (i) marketing services and (ii) communications services. Our corporate administrative functions are tracked separately and the associated costs are not pushed down to the operating segments. The following table summarizes selected financial information for each operating segment:

	Marketing Services		Communications Services		Corporate Overhead			Consolidated
Three Months Ended October 31, 2011
Revenue	$	1,234,927	$	1,679,131	$	-		$	2,914,058
Income (loss) from continuing operations before tax		48,371		499,934		(1,019,713	)		(471,408	)
Net (loss) income		48,371		499,934		(1,019,713	)		(471,408	)
Total assets		964,246		10,176,725		783,710			11,924,681
Intangibles		-		6,750,584		-			6,750,584
Goodwill		-		1,581,850		554,986			2,136,836
Depreciation and amortization		29,316		472,777		16,412			518,505

	Marketing Services		Communications Services			Corporate Overhead			Consolidated
Three Months Ended October 31, 2010
Revenue	$	1,282,356	$	1,667,938		$	-		$	2,950,294
Income (loss) from continuing operations before tax		50,644		(7,057	)		(465,188	)		(421,601	)
Net (loss) income		50,644		(7,057	)		(465,188	)		(421,601	)
Total assets		1,140,054		12,173,565			529,874			13,843,493
Intangibles		277,772		8,308,412			-			8,586,184
Goodwill		-		1,581,850			554,986			2,136,836
Depreciation and amortization		83,334		474,309			6,540			564,183

	Marketing Services		Communications Services		Corporate Overhead			Consolidated
Six Months Ended October 31, 2011
Revenue	$	2,704,500	$	3,151,231	$	-		$	5,855,731
Income (loss) from continuing operations before tax		77,009		798,419		(1,868,496	)		(993,068	)
Net (loss) income		77,009		798,419		(1,868,496	)		(993,068	)
Total assets		964,246		10,176,725		783,710			11,924,681
Intangibles		-		6,750,584		-			6,750,584
Goodwill		-		1,581,850		554,986			2,136,836
Depreciation and amortization		114,013		949,157		32,586			1,095,756

	Marketing Services			Communications Services		Corporate Overhead			Consolidated
Six Months Ended October 31, 2010
Revenue	$	2,458,385		$	3,369,511	$	-		$	5,827,896
Income (loss) from continuing operations before tax		(96,109	)		549,107		(855,861	)		(402,863	)
Net (loss) income		(96,109	)		549,107		(855,861	)		(402,863	)
Total assets		1,140,054			12,173,565		529,874			13,843,493
Intangibles		277,772			8,308,412		-			8,586,184
Goodwill		-			1,581,850		554,986			2,136,836
Depreciation and amortization		168,366			947,844		15,973			1,132,183

There were no intersegment sales. All of the Company's business activities are conducted within the United States geographic boundaries.

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Related Party Transactions

6 Months Ended

Oct. 31, 2011

Related Party Transactions [Abstract]

Related Party Transactions

8. Related Party Transactions

Enversa receives administrative support from Internet University, Inc., which was one of the three former members of Leadstream. Included in such administrative support are human resources and payroll services which totaled less than $20,000 for the six month period ended October 31, 2011.

As part of the Enversa acquisition, the Company borrowed $1,500,000 from Internet University, Inc., Marc Blumberg and Marc Pickren (collectively, the "Enversa Sellers").   Mr. Blumberg is a member of the Company's Board of Director as well as the president of Internet University, Inc. and Mr. Pickren is the President of the Company.  On March 30, 2011, the Company entered into amendments to its promissory notes with the Enversa Sellers (collectively the "Tier 4 Junior Notes"). The amendments to the Tier 4 Junior Notes revised the repayment schedules of the Tier 4 Junior Notes such that principal payments would be payable annually beginning on March 31, 2012 until such time as the Tier 4 Junior Notes mature on March 31, 2016. Interest payments are payable monthly at a revised rate of 15% per annum. The Company recorded interest of $93,029 and $33,097 on this facility during the six month periods ended October 31, 2011 and 2010, respectively.  The balance of the facility totaled $1,364,199 at October 31, 2011.

As part of the February 23, 2009 Woodland Acquisition, the Company borrowed $1,900,000 from IU Investments LLC. On March 30, 2011, the Company entered into Amendment No. 3 ("IU Amendment No. 3") to its Promissory Note to IU Investments, LLC (the "Tier 3 Junior Note").  IU Amendment No. 3 revised the repayment schedule of the Tier 3 Junior Note such that the Company will make principal payments totaling $27,417/month until February 28, 2012, after which time the Company will pay a lump sum of $191,919 then $67,200 annually beginning March 31, 2011 until such time as the Tier 3 Junior Note is paid in full on March 31, 2016. Interest payments are payable monthly at a rate of 10% per annum.  A member of the Company's Board of Directors as well as one of the selling partners of Enversa is an employee of the parent of IU Investments, LLC. The Company recorded interest of $28,384 and $53,637 on this facility during the six month periods ended October 31, 2011 and 2010, respectively.   The balance of this note totaled $527,915 at October 31, 2011.

On March 30, 2011, the Company entered into a subordinated $1.5 million promissory note (the "Tier 2 Junior Note") with IU Holdings, LP ("IUH").  Principal under the Tier 2 Junior Note is payable in quarterly installments of $187,500  commencing on February 29, 2012 until such point as the Tier 2 Junior Note matures on November 30, 2013.  Interest on the outstanding principal amount under the Tier 2 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce the Tier 2 Junior Lender to enter into this Promissory Note, the Company issued the Tier 2 Junior Lender, 48,414,132 shares of CornerWorld Corporation Common stock.  IUH is a partnership whose limited partners include friends and family of the Company's Chief Executive Officer.  The Company paid approximately $85,726 in interest on this facility, during the six month period ended October 31, 2011, to IUH as a result of this note.  The balance of this note totaled $1,500,000 at October 31, 2011.

On March 30, 2011, the Company entered into a subordinated $400,000 promissory note (the "Tier 5 Junior Note") with Internet University.  Principal under the Tier 5 Junior Note is payable in monthly installments of $25,000  commencing on April 30, 2011 until such point as the Tier 5 Junior Note matures on October 31, 2012.  Interest on the outstanding principal amount under the Tier 5 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce the Tier 5 Junior Lender to enter into this Promissory Note, the Company issued the Tier 5 Junior Lender, 12,910,435 shares of CornerWorld Corporation Common stock.  The Company recorded interest of $22,068 on this facility during the six month period ended October 31, 2011.  The balance of this note totaled $300,000 at October 31, 2011.

On March 30, 2011, the Company entered into a subordinated $389,942 promissory note (the "Tier 7 Junior Note") with Scott N. Beck, the Company's Chief Executive Officer.  Principal under the Tier 7 Junior Note is payable in monthly installments of $12,746  commencing on April 30, 2011 until such point as the Tier 7 Junior Note matures on September 30, 2013.  Interest on the outstanding principal amount under the Tier 7 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce Mr. Beck to enter into this Promissory Note, the Company issued Mr. Beck 12,585,802 shares of CornerWorld Corporation Common stock.  The Tier 7 Junior Note consists primarily of prior accounts payable.  The Company recorded interest of $17,730 on this facility during the six month period ended October 31, 2011.  The balance of this note totaled $338,958 at October 31, 2011.

On March 30, 2011, the Company entered into an unsecured $37,976 promissory note (the "Tier 8 Junior Note") with Kelly Larabee Morlan; Ms. Morlan is the Secretary of the Company.  Principal under the Tier 8 Junior Note is payable in monthly installments of $3,165  commencing on April 30, 2011 until such point as the Tier 8 Junior Note matures on September 30, 2012.  Interest on the outstanding principal amount under the Tier 8 Junior Note is payable monthly in arrears at a rate of 10% per annum.  As additional consideration to induce Ms. Morlan to enter into this Promissory Note, the Company issued Ms. Morlan 1,194,215 shares of CornerWorld Corporation Common stock.  The Tier 8 Junior Note is unsecured.  The Company recorded interest of $1,436 on this facility during the three month period ended October 31, 2011.  The balance of this note totaled $25,316 at October 31, 2011.

In addition, the Company leases office space with an entity that is controlled by the family of the Company's CEO. During the six month period ended October 31, 2011, the Company paid $101,522 in rent as a result of this lease.

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Condensed Consolidated Statements of Stockholders' Deficit (USD $)	Total	Common Shares [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]
Balance at Apr. 30, 2011	$ (738,970)	$ 146,972	$ 10,006,785	$ (10,892,727)
Balance, shares at Apr. 30, 2011		146,972,901
Stock-based compensation expense	74,892		74,892
Cash-less exercise of stock options and warrants		575	(575)
Cash-less exercise of stock options and warrants, shares		574,706
Net loss	(993,068)			(993,068)
Balance at Oct. 31, 2011	$ (1,657,146)	$ 147,547	$ 10,081,102	$ (11,885,795)
Balance, shares at Oct. 31, 2011		147,547,607

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Debt

6 Months Ended

Oct. 31, 2011

Debt [Abstract]

Debt

4. Debt

	As of
	October 31, 2011			April 30, 2011
Long-term Debt
Notes payable to Emerald Crest Capital (the "Senior Lender"); the notes mature March 31, 2015. The interest rate was floating at LIBOR plus 12%; the note's floor utilizes a minimum LIBOR of 3%. At October 31, 2011 the total rate was 15%. These notes are collateralized by all assets of the Company.	$	4,750,000		$	5,000,000
Note payable IU Holdings, LP; the note matures November 30, 2013.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		1,500,000			1,500,000
Note payable to IU Investments, LLC, due March 31, 2016. At October 31, 2011, the interest rate was 10%. These notes are collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		527,915			610,166
Notes payable to Internet University and the other selling members of Enversa; the notes mature March 31, 2016.  At October 31, 2011 the interest rate was 10.0%. These notes are collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		1,364,199			1,364,199
Note payable to Internet University; the note matures October 31, 2012.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		300,000			375,000
Note payable to Timmer; the note matures April 30, 2016.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of Woodland Holdings, Corporation, including the Ranger patent.		1,800,000			1,800,000
Note payable to CEO; the note matures September 30, 2013.  At October 31, 2011, the interest rate was 10%. This note is collateralized by all assets of the Company save for the Ranger patent. See also note 8, Related Party Transactions.		338,958			377,196
Note payable to Kelly Larabee Morlan; the note matures July 31, 2012.  At October 31, 2011, the interest rate was 10%. This note is not collateralized.		25,316			34,811
Total debt		10,606,388			11,061,372
Less current portion of long-term debt		(2,314,489	)		(2,706,973	)
Non-current portion of long-term debt	$	8,291,899		$	8,354,399

On March 29, 2011, the Company also entered into a warrant purchase agreement with the Senior Lender.  Pursuant to the warrant purchase agreement, the Company issued the Senior Lender a common stock purchase warrant (the "Warrant"), pursuant to which the Senior Lender may purchase up to 8,762,008 shares of the Company's common stock for an aggregate price of $100.  The warrant has a 5 year term and contains certain put and call provisions.  The Warrant is not exercisable prior to March 30, 2014.  Using the Black-Scholes model, the original value of the warrant issued to the Senior Lender was less than the net present value of the minimum $1,000,000 cash value of the warrants. Therefore, the net present value of $1,000,000, totaling $642,899 was recorded as a loan discount, which is being amortized to earnings as additional interest expense over the remaining term of the loan.  The warrant is revalued at each reporting date, and adjusted to earnings. In addition, other loan fees of $717,569 were incurred from the issuance of 75,104,584 shares of the Company's stock, $512,750 was paid or accrued, and $52,467 was incurred from the grant of additional warrants during March 2011. These fees are being amortized to earnings as additional interest over the remaining term of the loans. The unamortized balance of these deferred costs was $1,411,244 and $1,880,406 at October 31 and April 30, 2011, respectively, and is reflected as a loan discount to the outstanding balance of $10,606,388 and $11,061,372 at October 31, 2011 and April 30, 2011, respectively.

The notes payable to the Senior Lenders include certain restrictive covenants with respect to the Company's earnings, leverage and accounts payable. As of October 31, 2011, the Company believes it was in compliance with all restrictive covenants.

The notes are collateralized by 100% of the assets of the Company and its companies and the notes themselves are all cross-defaulted.