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ANNUAL REPORT
Walton Edgemont Development Corporation
2011
Walton Edgemont Development Corporation Edmonton, Alberta
ANNUAL REPORT
For the period ended December 31, 2011
ANNUAL REPORT
2011
CONTENTS
CEO Message to Shareholders

Managements Discussion and Analysis
Financial Statements
Directors and Officers
2011 Annual Report Walton Edgemont Development Corporation
CEO Message to Shareholders

We are pleased to present the Annual Report for Walton Edgemont Development Corporation (the Corporation). Launched in
2011, the Corporation owns a four-phase residential development located in southwest Edmonton.
As you read through this report, which details the Corporations first year of operations, you will see the factors that contribute
to our confidence in this project it is strategically situated in the anticipated path of growth, it is professionally-managed and it
follows a well-developed strategy that is consistent with local priorities.
Project Milestones
Having raised the required capital as planned, the Corporation acquired the intended land. We will now focus our efforts on meeting
specific development criteria throughout the life of this project. Management expects that the project will be completed within the
approximate time frame disclosed in the prospectus.
The following summarizes several milestones relating to the Corporation:
Q3 2011
Completed an initial public offering and private placement (collectively, the Offerings). The gross proceeds raised from the
Offerings were $30,000,000.
Q4 2011
Completed the acquisition of the Edgemont Properties.
Q4 2011
Obtained a $29.2 million construction loan to finance Phase 1 of the project.
Q4 2011
Commenced preliminary grading for Phase 1 of the project.
Northeast view of Walton Edgemont Development Corporation Fall 2011
Edgemont Estates March 2012
Edmonton
Market Environment
Edmontons GDP is forecasted to grow 3.4% in 2012 and unemployment is
projected to drop from 5.5% at the end of 2011 to 5.2% in 20121. Edmontons
economy is fuelled by a strong energy sector comprised of primary and secondary
industries that support the exploration, mining and processing of oil from the
Athabasca oilsands of the industrial north. There is renewed interest and significant
investment into several long term mega projects that should provide stimulus and benefit
not only to Edmontons energy related industries but also to increasingly diversified non-related
industries within the larger economy.
Edmontons strong economic prospects are anticipated to create a significant number of new jobs in 2012,
increasing total employment in Edmonton. Edmonton is forecasted to add approximately 10,000 jobs in 2012,
bringing total employment in Edmonton to approximately 681,000 jobs1.
Increased employment will contribute to accelerated in-migration, and will result in population growth, further supporting
housing demand. Lot servicing activity has continued its positive trend in 2011 since hitting low levels during the recession in 2009.
Given the expected increase in housing demand, combined with the slowdown in the growth of housing supply seen in 2009,
we anticipate that new housing units will need to be brought to market to keep up with expected demand which will benefit
the project. Total housing starts for 2012 are forecasted to be approximately 9,820 units2.
Goals
Overall, the Corporations development project is proceeding as planned.
Our goals for 2012 are to:
obtain contractual commitments from homebuilders for Phase 1 lots;
complete Phase 1 construction, deliver lots to homebuilders and open show homes to the public; and
make first distribution on the units comprised of interest payment, plus either principal repayments and or dividends
As Canada and the U.S. move into the next phase of economic growth in 2012, Walton maintains an optimistic outlook for our
managed real estate investments. Our investment team is working collaboratively with local authorities to create successful,
smart-growth communities that realize the highest and best use of our lands, ultimately attaining your and our investment
goals. Our experience is that, with expert management and Waltons carefully crafted approach, quality investments prevail.
Thank you for your investment in the Corporation, and thank you for your support and confidence in the Walton Group of
Companies.
Best regards,
Bill Doherty
Chief Executive Officer
1) Conference Board of Canada, Metropolitan Outlook Winter 2012, retrieved February 27, 2012.
2) Conference Board of Canada, Metropolitan Outlook 1 Winter 2012, Economic Insights Into 13 Canadian Metropolitan Economies
Managements Discussion & Analysis

For the three months ended December 31, 2011 and the period from May 5, 2011 to
December 31, 2011
March 26, 2012
The following managements discussion and analysis (MD&A) is a review of the financial condition and results of operations
of Walton Edgemont Development Corporation (the Corporation) for the three months ended December 31, 2011 and the
period from May 5, 2011 to December 31, 2011. The MD&A should be read in conjunction with the Corporations audited
financial statements for the period ended December 31, 2011, and the prospectus (Prospectus) of the Corporation dated
June 27, 2011.
All financial information is reported in Canadian dollars and has been prepared in accordance with International Financial
Reporting Standards ("IFRS) as issued by the International Accounting Standards Board (IASB). As this is the first year of
operations of the Corporation, these financial statements have also been prepared in accordance with IFRS 1: First-time
Adoption of International Financial Reporting Standards. In limited situations, IFRS has not issued rules and guidance
applicable to the real estate investment and development industry. In such instances, the Corporation has followed guidance
issued by the Real Property Association of Canada to the extent that such guidance does not conflict with the requirements
under IFRS or the definitions, recognition criteria and measurement concepts for assets, l iabilities, income and expenses in
the IFRS framework.
Additional information about the Corporation is available on SEDAR at www.sedar.com.
Critical Accounting Estimates

The preparation of financial information in conformity with IFRS requires management to make estimates and assumptions
that affect the reported amount of assets, liabilities and equity at the date of the financial statements, and the reported
amount of revenues and expenses during the period. The estimates and assumptions that have the most significant effect on
the amounts recognized in the Corporations financial statements are related to the recoverability of land held for
development and land development costs, and the recognition of future tax assets. In assessing the recoverability of land held
for development and land development costs, management is required to make estimates and assumptions regarding the sale
price for serviced lots, the costs to service the lots, the timing of lot sales, the completion date for the serviced lots and the
Corporations cost of capital. In assessing the amount of deferred tax assets to recognize, significant judgment is required in
determining the amount of deferred tax assets that can be recognized, which requires management to make estimates and
assumption regarding the likelihood, timing and level of future taxable profits. Changes in these estimates and assumptions
could cause actual results to differ materially from those reported.

2011 Annual Report Walton Edgemont Development Corporation Managements Discussion & Analysis
Forward-looking Statements
Certain information set forth in this material, including the disclosure of the anticipated completion dates of key project
milestones, are based on the Corporations current expectations, intentions, plans and beliefs, which are based on experience
and the Corporations assessment of historical and future trends. Such forward-looking statements necessarily involve known
and unknown risks and uncertainties, many of which are beyond managements control. These risks and uncertainties include,
but are not limited to, the timing of approval by municipalities, the estimated time required for construction and the business
and general economic environment. These uncertainties may cause the Corporations actual performance, as well as financial
results in future periods, to differ materially from any projections of future performance or results expressed or implied by such
forward-looking statements. Investors are cautioned against attributing undue certainty to forward-looking statements as
actual results could differ materially from managements targets, expectations or estimates.
Responsibility of Management
This MD&A has been prepared by, and is the responsibility of, the management of the Corporation.
Approval by the Board of Directors

The MD&A was authorized for issue by the board of directors on March 26, 2012.
Business Overview
The Corporation was established on May 5, 2011 for the purpose and objective of providing investors with the opportunity
to participate in the acquisition and development of the approximately 201.5 acre Edgemont properties located in the
Southwest corner of Edmonton, Alberta (the Properties). Access is provided by 199th Street via Lessard Road, which
intersects Anthony Henday Drive (Edmontons ring road) approximately one kilometre to the north of the Properties.
The Properties are bounded to the south by the Wedgewood Ravine, which provides an attractive setting for a residential
development and adds significant amenity value to the future community.
The Properties are included in the Edgemont Neighbourhood Area Structure Plan, the bylaw for which passed third and final
reading by Edmonton City Council on June 22, 2011. The development plan prepared for the project by Walton Development
and Management L.P. (WDM), which will manage the project, includes primarily "single-family" lots suitable for starter and
move-up homes, "low-density residential" which can accommodate multi-family development, and an environmental reserve,
natural areas, green space and parks. In total, the project is anticipated to consist of approximately 672 single-family lots, 5.1
acres of multi-family development, and associated parks and natural areas.
In order to raise sufficient capital for the acquisition and development of the Properties, the Corporation completed an initial
public offering (IPO) and follow-up private placement (Private Placement) of units during the third quarter of 2011.
Each unit issued by the Corporation (Unit) was comprised of a $7.50 principal amount of unsecured, subordinated,
convertible, extendable debenture bearing simple interest at a rate of 8% (Debenture) and one class B non-voting common
share (Class B share) having a price of $2.50. Following the completion of the IPO and Private Placement (collectively,
the Offerings), the Corporation completed the acquisition of the Properties during the fourth quarter of 2011.

The Corporations investment objectives are to:

i.) preserve the capital investment of the purchasers in the Units;
ii.) make annual cash distributions on the Units beginning in September 2012 until the final distribution of funds from
the project, which is anticipated to be in December of 2016; and
iii.) achieve a net internal rate of return of 13.5% on the $10.00 purchase price of the Units.
The Corporation intends to preserve the capital investment of the purchasers of Units in the Corporation and provide cash
distributions on the Units by executing the following four-step investment strategy:

i.) acquire the Properties;
ii.) obtain contractual commitments from home builders to purchase lots to be serviced in each of the four planned
phases of the development of the Properties before construction commences on that phase;
iii.) construct municipal services infrastructure on the Properties in phases to provide a controlled supply of serviced
lots to the marketplace; and
iv.) use the revenue from the sale of the serviced lots to repay construction loans and other obligations of the
Corporation and then pay the remainder to the holders of the Debentures and Class B shares by paying the interest
and principal on the Debentures by declaring a dividend or dividends on the Class B shares and/or winding up the
Corporation and distributing its assets to the holders of the Class B shares.
Although management expects that the execution of the investment strategy will allow the Corporation to pay distributions
on the Units, distributions by the Corporation are neither guaranteed nor will they be paid in a steady or stable stream.
The amounts and timing of any distributions will be at the sole discretion of the Corporation and only after the Corporation
has paid or reserved funds for its expenses, liabilities and commitments (other than with respect to the Debentures),
including (i) the fees payable to Walton Asset Management L.P. (WAM) and WDM (including the performance fee),
and (ii) any amounts outstanding, on a phase by phase basis, under the construction loans required to develop the Properties.
The performance fee is only payable provided that the investors of Units in the Corporation have received cash payments
or distributions equal to $10.00 per Unit, plus a simple cumulative priority return thereon, equal to 8% per annum.
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The registered office and principal place of business is 23 floor, 605 5 Avenue SW, Calgary, Alberta, T2P 3H5.

Summary Financial Data

For the period from
May 5, 2011
to December 31, 2011
Total revenues ($)
64,479
Total expenses ($)
831,595
Deferred income tax recovery ($)
205,127
Net loss and comprehensive loss ($)
561,989
1
Weighted average shares outstanding
2,006,269
Basic net loss per share ($)
0.28
1 Weighted average shares outstanding exclude the 100 Class A voting common shares issued. Based on the Corporations articles of incorporation, Class A shareholders are not entitled to
participate in any dividends declared by the Corporation, or the distributions of any part of the assets of the Corporation.
As at
December 31, 2011
As at
May 5, 2011
Total assets ($)
30,373,009
100
Total non-current liabilities ($)
22,184,572
Total liabilities ($)
23,554,639
Total Equity ($)
6,818,370
100
Class B shares outstanding end of period
3,120,139
Review of Operations
Summary
The period from May 5, 2011 to December 31, 2011 marked the first period of operations for the Corporation. The key activities
undertaken by the Corporation during the period were as follows:
During the second quarter of 2011, an application for the subdivision of the Properties was submitted by the vendors
of the Properties to the City of Edmonton.
During the third quarter of 2011, the Corporation completed the Offerings. Each Unit was priced at $10/Unit and was
comprised of one Debenture and one Class B share. In total, the Offerings resulted in the issuance of 3,000,000 Units
for gross proceeds of $30,000,000. The selling commissions, work fee and organizational costs associated with the
Offerings were $1,575,000, $42,280 and $450,000, respectively.
During the fourth quarter of 2011, the Corporation completed the acquisition of the Properties. This was completed
through the payment of $25,587,651 to unrelated parties for 193 acres and the issuance of 120,139 Units to Walton
International Group Inc. (WIGI) for an equivalent value of $1,138,317 for the remaining 8.6 acres.
During the fourth quarter of 2011, expressions of interest were obtained from four homebuilders to participate in the
first release of Phase 1 lots.
During the fourth quarter of 2011, the Corporation entered into a $29.2 million construction loan to finance Phase 1
of the project.
Preliminary grading for Phase 1, including the show home area, was initiated during the fourth quarter of 2011.
In comparison with the anticipated completion date for the key project milestones for Phase 1, the project has experienced
some delays in achieving these milestones during the period. Notwithstanding these delays, management expects that the
project will be completed within the approximate six-year time frame disclosed in the Prospectus and Offering Memorandum
(collectively, the Offering Documents).
During the period ended December 31, 2011, the Corporation generated total revenues of $64,479. These revenues were
comprised of interest earned on the Corporations cash on hand. The total expenses during the period were $831,595 and
primarily consisted of $450,000 in costs relating to the Offerings, $247,007 in costs incurred for the management of the
Corporation and $60,552 in servicing fees paid to the agents who sold Units through the Offerings. The nature and amount of
the expenses incurred by the Corporation during the period was consistent with managements expectations. The overall net
loss incurred by the Corporation during the period of $561,989 was also consistent with managements expectations because
the Corporation is not expected to generate significant revenue, except during periods when the sale of lots is completed.
Analysis of Financial Condition
As at December 31, 2011, the Corporation had total assets of $ 30,373,009, total liabilities of $23,554,639 and total
shareholders equity of $6,818,370. The most significant assets of the Corporation were land held for development of
$26,725,977, cash of $2,074,371 and land development costs of $1,365,598. The liabilities were comprised of debentures
payable of $22,184,572 and current liabilities of $1,370,067.
As at December 31, 2011, the Corporation was highly leveraged and this is expected to increase over the next year as the
Corporation draws on the construction loan to fund the ongoing administrative and operating expenses, management fee,
development fee, pre-development costs, construction costs and other expenses of the Corporation. The high amount of
leveraging employed by the Corporation is however, consistent with the planned capital structure of the Corporation. As the
development of the Properties proceeds, the Corporation will use the proceeds from the sale of serviced lots to make interest
and principal repayments on both the construction loan and the debentures payable.
The Corporation expects that the cash on hand at December 31, 2011, in combination with the phase 1 construction loan,
will be sufficient to finance Phase 1 of the project and the ongoing expenses of the Corporation during that time. As long as
the project continues as anticipated, the Corporation does not foresee any significant challenges in financing or completing
the remaining phases of the project.
Initial Public Offering and Private Placement

On June 27, 2011, the Corporation filed the Prospectus for the IPO of 3,000,000 Units of the Corporation at a price of
$10 per Unit. The IPO of the Corporation was completed on July 15, 2011 and resulted in the issuance of 2,577,200 Units
of the Corporation. The closing of the IPO was followed by the commencement of the Private Placement on July 18, 2011
for the remaining of 422,800 Units. The Private Placement was successfully completed on September 30, 2011 and resulted
in the issuance of 422,800 Units. Each Unit issued through the Offerings was comprised of one Debenture and one Class B
share. Of the $30,000,000 gross proceeds raised from the Offerings, $22,500,000 was paid as consideration for the debenture
payable and $7,500,000 was paid as consideration for the Class B shares. The total costs associated with the Offerings were
comprised of commissions and a work fee payable to the agents of $1,617,280 and costs incurred for the preparation of the
Offerings of $450,000. Of the commissions and work fee, $1,212,960 was allocated to the debenture component and $404,320
was allocated to the share component based on their proportionate share of the gross proceeds raised. The costs incurred
for the preparation of the Offerings have been recognized as an expense. The net proceeds raised from the Offerings of
$27,932,720 were consistent with the net proceeds anticipated by management and as disclosed in the Offering Documents.

10
Acquisition of the Properties

On October 12, 2011, the Corporation completed the acquisition of the approximately 117.93 acres of land (Parcel C),
part of which, which will be developed as part of Phase 1 of the project. The acquisition was completed through the payment of
$14,987,223 to unrelated parties for 113.05 acres, and the issuance of 68,079 Units to WIGI for an equivalent value of $645,052
for the remaining 4.88 acres.
On November 30, 2011, the Corporation completed the acquisition of the remaining 83.6 acres of the Properties (Parcels A
and B) . The acquisition was completed through the payment of $10,600,428 to unrelated parties for 79.96 acres, and the
issuance of 52,060 Units to WIGI for an equivalent value of $493,274 for the remaining 3.73 acres.
In accordance with the terms of the Walton Contribution Agreements between WIGI and the Corporation, the details of which
have been outlined in the Offering Documents, the Units issued to WIGI were issued at a price of $9.475 per Unit. This price
was determined by taking the $10/Unit issue price paid by the Corporations existing investors of Units in the Corporation,
less the $0.525 in selling commissions since neither WIGI nor the Corporation was obliged to pay selling commissions as part
of the land for Unit exchange.
Land Development Costs

The following table provides a breakdown of the amounts capitalized to land development costs by nature as at
December 31, 2011.
As at
December 31, 2011
$
Planning
Land development
Financing
Legal
Project management
Total land development costs
212,581
53,750
1,083,764
14,428
1,075
1,365,598
Land development costs can be divided into two primary categories: hard construction costs, which are the costs related to
the physical improvement of the land, and soft costs, which include but are not limited to, costs associated with architectural
control consultants, financing fees for establishing construction loans and security, interest on the construction loan and
debentures payable, legal fees, municipal taxes and construction management, and appraisal fees. Planning, financing, legal
and project management fees are all soft costs associated with the project, while land development costs include both hard
development costs and soft costs.
During the period ended December 31, 2011, the Corporation incurred total soft construction costs of $1,311,848. During the
period ended December 31, 2011, the Corporation incurred total hard development costs of $53,750. The land development
costs incurred during the period were consistent with the amounts anticipated by management for the work completed during
the period.
11
Organizational costs
Organizational costs are comprised of the legal, accounting, audit, printing, filing, transfer agent and other costs incurred by
the Corporation associated with the preparation for the Offerings and the preparation of the Offering Documents. During the
period ended December 31, 2011, the Corporation incurred total organizational costs of $450,000. These costs were consistent
with the costs anticipated by management as outlined in the Offering Documents. Given that the Corporation does not plan on
raising any additional equity over the life of the Corporation, management does not expect to incur any organizational costs in
future periods.
Management Fees
On June 27, 2011, the Corporation and WAM entered into a Management Services Agreement. In accordance with the terms of
the Management Services Agreement, WAM will provide management and administrative services to the Corporation in return
for an annual management fee equal to:
i.) from July 15, 2011 until the earlier of the date of termination of the Management Services Agreement and June 30,
2016, 2% of the aggregate of:
a.) The net proceeds raised from the IPO of $24,032,390, calculated as the gross proceeds raised of $25,772,000,
net of selling commissions of $1,353,030 and organizational costs of $386,580;
b.) The net proceeds raised from the Private Placement of $3,900,330, calculated as the gross proceeds raised
of $4,228,000, net of selling commissions $221,970, work fees of $42,280, and organizational costs of
$63,420; and
c.) the product of the number of Units issued by the Corporation to WIGI in exchange for its interest in the
Properties multiplied by $9.325 which was equal to $1,120,296; and
ii.) thereafter, from July 1, 2016 until the termination date of the Management Services Agreement, an amount equal
to 2% of the book value of the Properties.
During the period ended December 31, 2011, the Corporation incurred total management fees of $247,007.
The management fees incurred during the period were consistent with the costs anticipated by management, as outlined in
the Offering Documents.
Servicing Fees and Commissions

Under the terms of the Agency Agreements between the Corporation and the agents contracted to sell Units of the Corporation
through the Offerings, the Corporation will pay the agents a commission equal to 5.25% of the gross proceeds raised from the
Offerings and a work fee equal to 1% of the gross proceeds raised from the Private Placement. The Corporation will also pay the
agents an annual servicing fee equal to 0.5% of the net proceeds raised from the Offerings, until the earlier of the dissolution of
the Corporation and June 30, 2016. The commission and servicing fee is payable to WAM, which it will then pay such amounts
to the registered dealers on behalf of the Corporation.
During the period ended December 31, 2011, the Corporation incurred commissions, a work fee, and servicing fees of
$1,575,000, $42,280 and $60,552, respectively. The commissions and work fee have been accounted for as a reduction to the
initial carrying amount of the debentures payable and share capital, while the servicing fee has been recognized as an expense
during the period. The amount of the commissions, work fee, and servicing fees incurred during the period were consistent
with the costs anticipated by management, as outlined in the Offering Documents.
12
Transactions with Related Parties

WAM, WIGI, WDM and 1389211 Alberta Ltd. are all related to the Corporation by virtue of common management. The balances
due to these related parties as at December 31, 2011 are outlined in the table below. With the exception of the development
fee payable to WDM and the amounts payable to WAM for the servicing fee, these amounts are unsecured, due on demand,
bear no interest and have no fixed terms of repayment. The development fee payable to WDM is payable within 60 days of
quarter-end. The servicing fee which is paid to WAM is payable semi-annually.
As at
December 31, 2011
$
As at
May 5, 2011
$
Walton International Group Inc.
267,477
Walton Asset Management L.P.
69,695
2,183
339,355
Walton Development and Management L.P.

Total
The following transactions entered into between the related parties during the period were under terms and conditions agreed
upon between the parties.

In accordance with the Management Services Agreement between the Corporation and WAM, the Corporation
incurred total management fees during the period of $247,007.
In accordance with the Agency Agreements between the Corporation and its agents, the Corporation incurred total
servicing fees of $60,552 during the period. The servicing fees are payable to WAM, which is responsible for the
distribution of the servicing fees to the agents.
The balance payable to WAM as at December 31, 2011 was a result of the transactions disclosed above.

On September 30, 2011, WIGI acquired 37,440 Units of the Corporation for total consideration of $374,400 through
the Private Placement.
WIGI further acquired 68,079 Units in exchange for its 4.88 acres of Parcel C, and 52,060 Units in exchange for its 3.73
acres of Parcels A and B. In accordance with the terms of the Walton Contribution Agreement between WIGI and the
Corporation, the Units were issued to WIGI at a price of $9.475 per Unit, being the $10/Unit issue price paid by the
Corporations unitholders, less the $0.525 in selling commissions which neither WIGI nor the Corporation was obliged
to pay as part of the land for Unit exchange.
As a result of the transactions noted above, WIGI owns 157,579 Units of the Corporation, which represents
approximately 5% of the outstanding Units.
As at December 31, 2011, the Corporation owed WIGI $267,477. This was comprised of land development costs and
other costs of the Corporation which were initially funded by WIGI on behalf of the Corporation but are reimbursable
by the Corporation.
13

On June 27, 2011, the Corporation and WDM entered into a Project Management Agreement. In accordance with the
terms of the Project Management Agreement, the fees and costs for services provided by WDM are divided into the
following two categories:
i.) WDM will receive a development fee, plus applicable taxes equal to 2% of certain development costs
incurred in the calendar quarter, payable within 60 days of the end of such quarter.
ii.) WDM will receive a performance fee, plus applicable taxes, equal to 25% of cash distributions after all
investors of Units in the Corporation have received cash payments or distributions equal to $10 per Unit,
plus an 8% priority return. The priority return is calculated on that $10 amount per Unit, reduced by any
cash payments or distributions by the Corporation.
For the period from May 5, 2011 to December 31, 2011, the total development fee charged to the Corporation
was $1,075. This amount has been capitalized as part of land development costs.
No performance fee was incurred by the Corporation during the period ended December 31, 2011 because the
$10 per Unit amount and the cumulative priority return have not been received by the investors of Units in
the Corporation.
As at December 31, 2011, balance owing to WDM was comprised of the development fee and land improvement
costs, which were paid for by WDM on behalf of the Corporation but are reimbursable by the Corporation.
1389211 Alberta Ltd.

On May 5, 2011, the Corporation issued to 1389211 Alberta Ltd. 100 Class A voting common shares (Class A shares)
for total consideration of $100.
Key Management Compensation

Key management personnel are comprised of the Corporations directors and executive officers. The total
compensation expense incurred by the Corporation relating to its directors was as follows:
For the period from

May 5, 2011 to
December 31, 2011
$
Director fees
34,339
All services performed for the Corporation by its executive officers is governed by the Management Services
Agreement. The annual management fee that WAM receives under the Management Services Agreement has been
disclosed above.
Non-Financial Indicators
The amount of revenues generated by the Corporation is not expected to be significant, until the sale of lots commences.
As a result, the financial statements alone are not a good indicator of the progress of the Corporation toward its investment
objectives. The Corporation makes use of the following non-financial indicators in evaluating its performance.
14
Key Milestones
For Phase 1 of the project, the key milestones used by management include those presented in the Offering
Documents. The Corporations progress toward these milestones has been summarized in the following table.
Walton Edgemont Development Corporation Key Project Milestones for Phase 1

Anticipated steps to completion
Form homebuilder syndicate and meet
lender pre-sale test requirement
Initiate preliminary grading of Phase 1
lands for show homes only
Submit application to subdivide the
property and obtain subdivision
approval.
Negotiate final terms of bank financing
for construction loan
Execute homebuilder purchase and sale
agreements for Phase 1 single-family
lots and obtain deposits
Complete underground utility

construction (onsite and offsite)
Anticipated completion date

per Prospectus
Status
May July, 2011
Completed in March 2012
August September, 2011

Initiated in December 2011
May September, 2011

Application submitted in
February 2012
Approval anticipated in April 2012
June August, 2011

September, 2011

September December, 2011

Obtain subdivision plan registration
December, 2011
Complete roadway construction (onsite

and offsite)
May June, 2012

Completed in November 2011

Purchase and sale agreements for
91 of the 176 single family lots
were executed in March 2012
Completion of onsite underground
utilities anticipated by the end of
July 2012
Completion of offsite underground
utilities anticipated in 2013
Anticipated completion by the end
of June 2012
Completion of onsite roadway
construction anticipated by the end
of September 2012
Completion of offsite roadway
construction anticipated in 2013
In comparison to the anticipated completion dates included in the Offering Documents, the milestones for Phase 1
are behind the timelines initially anticipated by management and are now anticipated to be completed in the year
2013. These delays are attributable to the longer than anticipated time to obtain subdivision approvals from the City
of Edmonton. The most significant delays are in respect of the construction of offsite utilities and offsite roadways,
which are expected to have little, if any, impact on the ability of homebuilders to commence the construction of show
homes, or their ability to commence the sale of single family or multi-family homes. As a result, management expects
that the timing of the completion of the overall project will be unchanged and the ability of the Corporation to
achieve its investment objectives will be unaffected.
15
Lot Activity Report

In November 2011, the Corporation received expressions of interest from four homebuilders to acquire 91 of the 176
Phase 1 lots. Executed purchase and sale agreements for those and initial deposits for the 91 lots were received in
February and March 2012.
Phases 2, 3 and 4
The steps to complete Phases 2, 3 and 4 of the project are substantially the same as the milestones for Phase 1.
The commencement dates for Phase 2, 3 and 4 have not yet been determined, and the expected completion dates
of their key milestones will be determined closer to the commencement of those phases.
Review of Fourth Quarter Operations

Having successfully completed the Offerings during the third quarter of 2011, the Corporation undertook the following activities
during the fourth quarter of 2011:
The Corporation completed the acquisition of Parcel C on October 12, 2011 and Parcels A and B on November 30,
2011. In total, the acquisition of the Properties was completed through the payment of $25,587,651 to unrelated
parties for 193 acres, and the issuance of 120,139 Units to WIGI for an equivalent value of $1,138,317, for the
remaining 8.6 acres.
In November 2011, the Corporation negotiated the final terms for the Phase 1 construction loan.
The Phase 1 construction loan will help to finance pre-development, development, grading and construction
of Phase 1 of the project.
In November 2011, the Corporation received expressions of interest from four builders who will acquire 91
of the 176 Phase 1 lots.
The Corporation commenced preliminary grading of the Phase 1 lands, including the Phase 1 show homes area,
in November 2011.
Although some of the above activities were completed later than the completion date initially anticipated by management,
these delays are not expected to affect the ability of the Corporation to complete the project within the approximate six-year
time frame disclosed in the Offering Documents.
During the fourth quarter of 2011, the Corporation incurred total expenses of $197,391, which primarily consisted of $122,778
in costs incurred for the management of the Corporation, $34,820 in servicing fees paid to the agents who sold Units through
the Offerings, and $13,032 in director fees. The nature and amount of the expenses incurred by the Corporation during the
fourth quarter were consistent with managements expectations. The net loss before taxes incurred by the Corporation during
the fourth quarter was also consistent with managements expectations because the Corporation is not expected to generate
significant revenue, except during periods when the sale of lots is completed.
On an after tax basis, the Corporation generated net income of $7,736 during the fourth quarter of 2011. The deferred tax
recovery recognized during the fourth quarter of $205,127 was in respect of prior period tax losses which met the recognition
criteria under IFRS during the fourth quarter of 2011.

16
Summary of Quarterly Results

A summary of operating results for the past three quarters is as follows:
Three months ended

December 31,
2011
September 30,
2011
June 30,
2
2011
Total assets ($)
30,373,009
28,281,165
13,166
Total liabilities ($)
23,554,639
21,755,110
21,307
6,818,370
6,526,055
(8,141)
64,479
Total expenses ($)
197,391
625,963
8,241
Deferred tax recovery ($)
205,127
7,736
(561,484)
(8,241)
3,076,741
2,161,600
(0.26)
N/A
120,139
3,000,000
3,120,139
3,000,000
Total equity/(deficit) ($)

Total revenue ($)
Net income (loss) and comprehensive income (loss) ($)

1
Weighted average shares outstanding

1
Basic and diluted net income (loss) per share ($)

Class B shares issued during the period
2
Class B shares outstanding end of period

1 - Class A shares outstanding have not been included in the weighted average shares outstanding because the Class A shares do not participate in the profits or losses of the Corporation.
2 The Corporation was formed on May 5, 2011. As a result, the period ended June 30, 2011 was from May 5, 2011 June 30, 2011.

During the periods ended June 30, 2011 and September 30, 2011, the main focus of the Corporation was to raise sufficient
capital to enable the Corporation to execute its investment strategy. This was accomplished through the successful completion
of the Offerings during the third quarter of 2011. In total, the Offerings resulted in the issuance of 3,000,000 Units of the
Corporation for gross proceeds of $30,000,000. Each Unit offered through the Offerings was comprised of one Debenture and
one Class B share. The completion of the Offerings increased the total assets, total liabilities and total equity of the Corporation
significantly. The expenses of the Corporation relating the Offerings were incurred during the third quarter of 2011 and
totalled $450,000.
During the fourth quarter of 2011, the Corporation completed the acquisition of the Properties through the payment of
$25,587,651 to unrelated parties for 193 acres, and the issuance of 120,139 Units to WIGI for an equivalent value of
$1,138,317, for the remaining 8.6 acres. Having successfully completed the Offerings during the third quarter of 2011, the
Corporations expenses decreased substantially during the fourth quarter. This was partially offset by an increase to the total
servicing fees and management fees incurred during the fourth quarter, which were only in effect for a portion of the third
quarter of 2011. The amount of the expenses of the Corporation in future quarters is expected to be consistent with the level
of expenses incurred during the fourth quarter of 2011. The Corporation is not expected to generate a profit until the sale of
lots commences. Until this time, the total equity of the Corporation is expected to decline as cash is expended to pay for the
ongoing expenses of the Corporation.
During the fourth quarter of 2011, the Corporation recognized a deferred tax recovery of $ 205,127. This was in respect of prior
period tax losses which met the recognition criteria under IFRS during the fourth quarter of 2011.
17
Subsequent Events
On February 27, 2012, WEDC received rezoning approval for Phase 1 from Edmonton City Council.
In March 2012, the Corporation entered into purchase and sale agreements for 91 of the 176 lots. In addition, the multi-family
site in Phase 1 has been conditionally sold.
Supplemental Information
Liquidity and Capital Resources
The Corporation has two sources of capital to finance its operations:
i.)
Of the gross proceeds raised under the IPO and Private Placement, approximately 9.1% ($2.7 million) was set aside
by the Corporation to pay for its ongoing administrative and operating expenses, management fee, development fee,
pre-development costs, grading costs, construction costs and other expenses of the Corporation. As at December 31,
2011, the Corporation had total cash on hand of $2,074,371.
ii.) The Corporation has a construction loan to help finance Phase 1 of the project. The construction loan consists of a
$26.9 million non-revolving loan facility and $2.3 million letter(s) of credit. This loan is partially guaranteed by WIGI
and is also secured by a first priority security interest in all present and after acquired personal property of the
Corporation, a floating charge over all of the Corporation's present and after acquired real and other property,
and a first fixed and specific demand collateral land mortgage over the Properties. The total amount drawn on the
construction loan at December 31, 2011 was $nil. It is anticipated that further construction loans will be required to
fund the costs of development for Phase 2, 3 and 4 of the project.
Management regularly reviews the levels of its capital resources to determine if sufficient cash is available to fund the ongoing
costs of the Corporation over the next twelve months. As at December 31, 2011, management believes that sufficient capital
exists to fund the Corporations activities for at least the next 12 months. WIGI monitors, on a monthly basis, its net worth to
ensure compliance with its obligations as a guarantor. As at December 31, 2011, WIGI was in compliance with this requirement,
and foresees no circumstances or conditions which may be reasonably likely to cause WIGI to be offside with its obligations a s
guarantor over the next 12 months.
Off-Balance Sheet Arrangements

There were no off-balance sheet arrangements as at December 31, 2011.
Financial Instruments
The Corporations financial instruments consist of other receivable, cash, debentures payable, interest payable, trade payables
and accrued liabilities and due to related parties. Other receivable and cash are classified as loans and receivables, and are
carried at amortized cost using the effective interest rate method. Debentures payable, interest payable, trade payables and
accrued liabilities, and due to related parties have been classified as other financial liabilities, and are carried at amortized cost
using the effective interest rate method. With the exception of debentures payable, the fair value of these financial instruments
approximate their carrying value due to the short-term nature of these items. The fair value of debentures payable
approximates the carrying amount because the interest rate on the debentures approximates the interest rate on debentures
issued by comparable entities.
It is management's opinion that the Corporation is not exposed to significant liquidity, credit, interest or currency risk.
18
Outstanding Shares
As of the date of this MD&A, the Corporation had 100 Class A shares outstanding and 3,120,139 Class B shares outstanding.
Outstanding Debentures
As of the date of this MD&A, the Corporation had 3,120,139 debentures payable outstanding with a carrying value of
approximately $22.2 million and principal amount of $23.4 million. The Corporation may in its sole discretion, convert all or any
principal amount of the debentures payable into a variable number of Class B shares, based on the fair market value per Class B
share on the date of the conversion.
Commitments
The following table presents future commitments of the Corporation under the Management Services Agreement and the
Agency Agreements over the next five years. It does not include the WDMs performance fee under the Project Management
Agreement, which is calculated based on the amount of distributions paid by the Corporation. These commitments will be
funded through future revenues generated by the Corporation and the capital resources available to the Corporation.
Servicing fee
$
Management fee
$
Total
$
139,664
139,664
139,664
139,664
69,832
628,488
581,060
581,060
581,060
581,060
290,530
2,614,770
720,724
720,724
720,724
720,724
360,362
3,243,258
2012
2013
2014
2015
2016
Total
The commitment for the management fee will extend for the length of the project, however, after June 30, 2016, it is calculated
based on the book value of the Properties at the end of the previous calendar quarter, which cannot be reasonably estimated
at this time.
Future Changes in Accounting Policy

Financial instruments
IFRS 9: Financial Instruments (IFRS 9) was issued in November 2009 and addresses classification and measurement of
financial assets. It replaces the multiple category and measurement models in I nternational Accounting Standard 39: Financial
Instruments Recognition and Measurement (IAS 39) for debt instruments with a new mixed measurement model having
only two categories: amortized cost and fair value through profit or loss. Requirements for financial liabilities were added to
IFRS 9 in October 2010 and they largely carried forward existing requirements in IAS 39, except that fair value changes due to
credit risk for liabilities designated at fair value through profit and loss are generally recorded in other comprehensive income.
IFRS 9 is effective for annual periods beginning after January 1, 2015, with early adoption permitted. The Corporation will adopt
IFRS 9 for the annual year beginning on January 1, 2015. The adoption of IFRS 9 will result in a change in the classification of the
Corporations financial assets from amortized cost to fair value through profit or loss, this change is not expected to result in a
material change to the carrying amount of these financial assets. IFRS 9 is not expected to result in any changes to the
classification or carrying amount the Corporations financial liabilities.

19
Fair value measurement

IFRS 13: Fair Value Measurement (IFRS 13) is a comprehensive standard for fair value measurement and disclosure for use
across all IFRS standards. The new standard clarifies that fair value is the price that would be received to sell an asset, or paid
to transfer a liability in an orderly transaction between market participants, at the measurement date. Under existing IFRS,
guidance on measuring and disclosing fair value is dispersed among the specific standards requiring fair value measurements
and does not always reflect a clear measurement basis or consistent disclosures.
IFRS 13 is effective for annual periods beginning after January 1, 2013, with early adoption permitted. The Corporation will
adopt IFRS 13 for the annual year beginning on January 1, 2013. Currently, all financial instruments are initially recognized at
fair value and subsequently carried at amortized cost. The Corporation also discloses the fair value of financial instruments in
the notes to the financial statements. The adoption of IFRS 13 is not expected to result in any changes to the measurement
and disclosure of the fair value its financial instruments.
Corporate Governance
Board of Directors
The mandate of the board of directors is to oversee the management of the business of the Corporation, with a view
to maximizing the Corporations shareholder value, and ensuring corporate conduct in an ethical and legal manner
via an appropriate system of corporate governance and internal control processes and procedures.

The board of directors facilitates its exercise of independent supervision over management through,
among other things:

The adoption by the board of directors of a written mandate requiring that a majority of the members
of the board of directors be independent of management; and
The requirement, in the board of directors written mandate for its audit committee, that the audit
committee be comprised solely of directors that are independent of management.

The board of directors is comprised of Clifford H. Fryers, Jon N. Hagan and Richard R. Singleton. Within the
meaning of National Instrument 52-110 Audit Committees (NI 52-110), Jon N. Hagan and Richard R. Singleton
are independent of management of the Corporation, while Clifford H. Fryers is not independent as his spouse is the
Corporate Secretary of the Corporation.

The only standing committee of the board of directors is the audit committee (the Audit Committee), which
consists of Richard R. Singleton and Jon N. Hagan.
Personal Profiles
20
Clifford H. Fryers Mr. Fryers has been Chairman and Chief Executive Officer of the White Iron Group of Companies
(a media production house) since 1997. He also is the chair of the board of the Manning Centre for Building
Democracy and is on the board of directors of several companies in the Walton Group, including the following
reporting issuers: Walton Ontario Land 1 Corporation, being the general partner of Walton Ontario Land L.P. 1;
Walton Big Lake Development Corporation, being the general partner of Walton Big Lake Development L.P.; Walton
Yellowhead Development Corporation; and Walton Westphalia Development Corporation. He was on the Board of
Advisors of Walton Global Investments Ltd. for eight years, retiring as Vice Chairman in November of 2011.

From 1997 until 2000, Mr. Fryers was Chief of Staff to the Leader of Her Majestys Official Opposition in the House
of Commons. Prior to that, he was a Senior Tax Partner and Managing Partner with the law firm of Milner Fenerty
(now Fraser Milner Casgrain LLP) which he joined in 1980. He worked in the Tax Litigation Section of the Department
of Justice, Ottawa from 1971 to 1977 and then as General Tax Counsel for Mobil Oil Canada, Ltd. until 1980.
Mr. Fryers holds the ICD.D certification granted by the Institute of Corporate Directors.
Jon N. Hagan - Mr. Hagan has been the principal of JN Hagan Consulting since December 2000. He provides assistance
to major corporations regarding real estate capital markets, and acquisition and disposition transactions covering
situations in Canada, the United States of America, Mexico and China.
Mr. Hagan is also a director and member of the audit and executive committees of the board of directors of First
Capital Realty Inc, which is a reporting issuer in Canada. He was formerly a director and member of the audit, human
resources, corporate governance and investment committees of Bentall Kennedy Group from 2001 to 2011. He was
a trustee of Sunrise Senior Living Real Estate Investment Trust from 2004 to 2007 and was the chair of the audit
committee thereof. He was the Chairman of Teranet Income Fund from 2006 to 2008. He was a director and on the
audit committee of the board of directors of The Mills Corporation for the first three months of 2007 to assist in the
sale of The Mills Corporation. Mr. Hagan is also on the board of directors of the following reporting issuers within the
Walton Group: Walton Ontario Land 1 Corporation, being the general partner of Walton Ontario Land L.P. 1;
Walton Big Lake Development Corporation, being the general partner of Walton Big Lake Development L.P.;
Walton Yellowhead Development Corporation; and Walton Westphalia Development Corporation.
Mr. Hagan has held a number of executive finance positions in the real estate industry, beginning with Oxford in
the 1970s. His career took him to Cambridge Shopping Centres in 1980, where he eventually became S enior Vice-
President, Corporate Group and Chief Financial Officer. He then joined the Empire Company Limited where he was
Executive Vice-President, Finance and Corporate Development. From 1996 through 2000, he was Executive Vice
President and Chief Financial Officer of Cadillac Fairview Corporation. Mr Hagan's experience spans corporate
strategy, corporate and real estate finance, real estate acquisition and disposition, compensation programs,
computer systems, financial reporting, forecasting and budgeting.

Mr. Hagan is a chartered accountant. He holds a BSc in Mechanical Engineering from the University of Saskatchewan
and attended the Executive MBA program at the University of Alberta.

Richard R. Singleton Mr. Singleton was one of the lead architectural partners with Cohos Evamy Partners,
Architects, Engineers, Planners (now called Dialogue Design) for 36 years. He primarily focused on larger commercial
projects and planning work in Alberta and throughout Canada. Mr. Singleton has been retired since 2 008, and, during
that time, he has consulted and provided assistance to developers in various planning and building projects. During
his career, Mr. Singletons work included major land planning and land parcel development projects primarily in
Alberta and other major commercial projects in other parts of Canada. His experience spanned land use project
financial proforma analyses, budgeting for land use and development projects, concept design and approval agency
policy planning initiatives. Mr. Singleton is also on the board of directors of the following reporting issuers within the
Walton Group: Walton Ontario Land 1 Corporation, being the general partner of Walton Ontario Land L.P. 1; Walton
Big Lake Development Corporation, being the general partner of Walton Big Lake Development L.P.; Walton
Yellowhead Development Corporation; and Walton Westphalia Development Corporation.

Mr. Singleton is presently a director of the National Music Centre (Cantos Foundation), a member of the Advisory
Board of Thermal Systems KWC Ltd., a past member of the Calgary Arts Development Authority and a board member
of a private real estate investment group. He was previously a member of the Board of Advisors of Walton Global
Investments Ltd.

21
Mr. Singleton holds a Bachelor of Architecture from the University of Manitoba and is LEED (Leadership in Energy and
Environmental Design) accredited. LEED is a set of rating systems for the design, construction and operation of high
performance green buildings, homes and neighbourhoods.
Compensation
The Corporation has agreed to pay to each of the directors who are independent within the meaning of NI 52-110,
an annual retainer of $25,000 per year, paid quarterly in advance. This amount was determined by the Corporation
and the directors prior to the retention of the directors.

The executive officers of the Corporation do not receive any compensation from the Corporation.
Orientation and Continuing Education

New directors will attend a briefing with existing directors on all aspects of the nature and operation of the
Corporations business from the existing directors and the senior management of the Corporation.

Directors will be afforded the opportunity to attend and participate in seminars and continuing education programs
and are encouraged to identify their continuing education needs through a variety of means, including discussions
with senior management of the Corporation and at meetings of the directors. Outside experts may be retained, as
appropriate, to provide directors with ongoing education on specific subject matters.
Nomination of Directors
The original members of the board of directors were appointed by the Class A shareholder of the Corporation. If and
when a director resigns, the remaining directors will identify a new director with a view to ensuring overall diversity
of experience and skill. The new director may be appointed by the remaining directors or by the Class A shareholder
of Corporation.
Assessments
The directors will regularly assess themselves with respect to their effectiveness and contribution.
Audit Committee
The primary function of the Audit Committee is to assist the board of directors in fulfilling their responsibility of
oversight and supervision of the Corporations accounting and financial reporting practices and procedures, the
adequacy of internal controls and procedures, and the quality and integrity of its financial statements. In addition,
the Audit Committee will be responsible for directing the auditors examination of specific areas, for the selection
of the Corporations independent auditors and for the approval of all non-audit services for which its auditors
may be engaged, including the fees for such services.

The Audit Committee currently consists of Jon N. Hagan and Richard R. Singleton. Each member of the Audit
Committee is independent as contemplated by NI 52-110 and each is financially literate, meaning that each has
the ability to read and understand a set of financial statements that present a breadth and level of complexity of
accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be
expected to be raised by the financial statements of the Corporation.
22
Ethical Business Conduct

Directors who have, or may be reasonably perceived to have, a personal interest in a transaction or agreement being
contemplated by the Corporation are required to declare such interest at any meeting at which the matter is being
considered and, where appropriate, leave the meeting during the discussion and abstain from voting on such matter.
The directors encourage and promote a culture of ethical business conduct by expecting each director, as well as the
officers of the Corporation, to act in a manner that exemplifies ethical business conduct.

The Corporation has established a Code of Business Conduct and Ethics to which all directors, officers and employees
of the Corporation are required to adhere. This code requires that all such individuals conduct themselves in a
professional and ethical manner, and that they must not condone or encourage unethical conduct. This code also
requires that any individuals who are aware of dishonest activities or conduct to report the conduct to the President
and CEO.
Whistleblower Policy
The Corporation has established a Whistleblower Policy to ensure the integrity of the accounting records and financial
statements of the Corporation and its compliance with applicable laws. Under the whistleblower policy, any employee
who becomes aware of any questionable accounting, internal accounting controls, auditing matters or potential
violations of law are encouraged to contact their immediate supervisor, their immediate supervisors manager,
the President or the Chief Operating Officer. Employees also have the option of reporting such matters directly to
the chair of the Audit Committee or the chair of the board of directors. Appropriate procedures are then undertaken
to ensure that the report is promptly and thoroughly investigated.

23
Financial Statements
For the period from May 5, 2011 to December 31, 2011
(expressed in Canadian Dollars)
24
2011 Annual Report Walton Edgemont Development Corporation Financial Statements
Independent Auditors Report

To the Shareholders of
Walton Edgemont Development Corporation.
We have audited the accompanying financial statements of Walton Edgemont Development Corporation, which
comprise the statements of financial position as at December 31, 2011 and May 5, 2011 and the statements of
comprehensive loss, changes in shareholders equity and cash flows for the period May 5, 2011 to December 31,
2011, and the related notes, which comprise a summary of significant accounting policies.
Managements responsibility for the financial statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance
with International Financial Reporting Standards, and for such internal control as management determines is
necessary to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.
Auditors responsibility
Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our
audits in accordance with Canadian generally accepted auditing standards. Those standards require that we
comply with ethical requirements and plan and perform the audits to obtain reasonable assurance about
whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditors judgment, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal control relevant to the entitys preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the entitys internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis
for our audit opinion.
Opinion
In our opinion, the financial statements present fairly, in all material respects, the financial position of Walton
Edgemont Development Corporation as at December 31, 2011 and May 5, 2011 and its financial performance
and its cash flows for the period May 5, 2011 to December 31, 2011 in accordance with International Financial
Reporting Standards.
Chartered Accountants
Calgary, Alberta
March 26, 2012
PricewaterhouseCoopers LLP, Chartered Accountants
111 5th Avenue SW Suite 3100, Calgary, Alberta, Canada T2P 5L3
T: 403 509 7500 F:403 781 1825, www.pwc.com/ca
PwC refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.
25

Statement of Financial Position
AS AT DECEMBER 31, 2011 AND MAY 5, 2011
(expressed in Canadian dollars)

December 31,
2011
$
May 5,
2011
$
1,365,598
26,725,977
205,127
ASSETS
Land development costs (note 4)
Land held for development (note 5)
Deferred tax asset (note 11)
Other receivable
1,936
Cash
2,074,371
100
TOTAL ASSETS
30,373,009
100
Debentures payable (note 6)
22,184,572
Interest payable (note 6)
796,643
Trade payables and accrued liabilities
202,402
GST payable
31,667
Due to related parties (note 9)
339,355
TOTAL LIABILITIES
23,554,639
Share capital (note 10)
7,380,359
100
Accumulated deficit
(561,989)
TOTAL EQUITY
6,818,370
100
30,373,009

The accompanying notes to the financial statements are an integral part of these statements

Approved on behalf of the Board of Directors

100
LIABILITIES
SHAREHOLDERS EQUITY
TOTAL LIABILITIES & EQUITY
__________________________ Director
Clifford H. Fryers

26
___________________________ Director
Jon N. Hagan

Statement of Comprehensive Loss
FOR THE PERIOD FROM MAY 5, 2011 TO DECEMBER 31, 2011

2011
$
Three $

30,168
64,479
EXPENSES
450,000
146,570
247,007
Servicing fees (note 9)
34,820
60,552
Director fees (note 9)
13,032
34,339
Professional fees
11,187
21,946
Office expenses
9,324
17,751
214,933
831,595
(184,765)
(767,116)
Current tax expense (note 11)
Deferred tax recovery (note 11)
205,127
NET LOSS AND COMPREHENSIVE LOSS
(561,989)
(0.06)
(0.28)

The accompanying notes to the financial statements are an integral part of these statements.
REVENUE
Interest Income
Organizational costs
Management fees (note 9)
NET LOSS BEFORE TAXES
Basic and diluted loss per share (note 10)
27

Statement of Changes in Shareholders Equity

Class A Voting
Common Shares
# of
Shares
Balance May 5, 2011
Class B Non-voting
Common Shares
# of
$
Shares
Total
100
100
100
Shares issued for cash
3,000,000
7,500,000
7,500,000
Share issuance costs
(404,320)
(404,320)
Shares issued in exchange for land
120,139
284,579
284,579
Net loss and comprehensive loss
(561,989)
(561,989)
Balance December 31, 2011
100
100
3,120,139
7,380,259
(561,989)
6,818,370
The accompanying notes to the financial statements are an integral part of these statements.
28
Accumulated
Deficit

Statement of Cash Flows

Three
2011
$
CASH PROVIDED BY (USED IN)

OPERATING ACTIVITIES
Net loss
Changes in non-cash working capital items
Increase in land development costs (note 4)
Increase in land held for development (note 5)
Increase in deferred tax asset (note 11)
Increase in other receivable
Increase in interest payable
Increase in due to related parties
Increase in GST payable
Increase in trade payables and accrued liabilities

FINANCING ACTIVITIES
(184,765)
(561,989)

(1,007,877)
25,789
463,579
239,883
31,667
(1,321,804)
(25,587,660)
(205,127)
(1,936)
796,643
339,355
31,667
129,586
(27,003,116)
(26,308,449)
202,402
897,532
21,287,040
7,095,680
-
1,182,111
28,382,720
(25,821,005)
2,074,271
27,895,374
100
2,074,371
2,074,371
SUPPLEMENTAL CASH FLOW INFORMATION
Cash interest received
92,681
Issuance of debentures payable

Issuance of Class B shares
Increase in cash
Cash Beginning of period
Cash End of period
The accompanying notes to the interim financial statements are an integral part of these statements.
29

Notes to the Financial Statements

1. Nature of Business
Walton Edgemont Development Corporation (the Corporation) was incorporated under the laws of the province of
Alberta on May 5, 2011.
The Corporation was formed to provide subscribers with the opportunity to participate in the development of the
approximately 201.5 acre Edgemont properties located in Edmonton, Alberta (the Properties) through the purchase of
units in the Corporation. Each unit issued by the Corporation (Unit) through its initial public offering (IPO) and private
placement offering (Private Placement) was comprised of a $7.50 principal amount of offering debenture and one class B
non-voting common share (Class B share) at a price of $2.50 per share.
The Corporation intends to preserve the capital investment of the purchasers of Units in the Corporation and provide cash
distributions on the Units by executing the following four step strategy:
i.) acquire the Properties;
ii.) obtain contractual commitments from homebuilders to purchase lots to be serviced in each of the four planned
phases of the development of the Properties before construction commences on that phase;
iii.) construct municipal services infrastructure on the Properties in phases to provide a controlled supply of serviced
lots to the marketplace; and
iv.) use the revenue from the sale of the serviced lots to repay construction loans and other obligations of the
Corporation and then pay the remainder to the holders of the offering debentures and Class B shares by paying
the interest and principal on the offering debentures and by declaring a dividend or dividends on the Class B shares
and/or winding up the Corporation and distributing its assets to the holders of the Class B shares.
Distributions by the Corporation are neither guaranteed nor will they be paid in a steady or stable stream. The amounts
and timing of any distributions will be at the sole discretion of the Corporation and only after the Corporation has paid or
reserved funds for its expenses, liabilities and commitments (other than with respect to the offering debentures), including
(i) the fees payable to Walton Asset Management L.P. (WAM) and Walton Development and Management L.P. (WDM)
(including the performance fee see note 9), and (ii) any amounts outstanding, on a phase by phase basis, under the
construction loans required to develop the Properties. The performance fee is only payable provided that the investors of
Units in the Corporation have received cash payments or distributions equal to $10.00 per Unit, plus a simple cumulative
priority return thereon, equal to 8% per annum.
rd
th
The registered office and principal place of business is 23 floor, 605 5 Avenue SW, Calgary, Alberta, T2P 3H5.
These financial statements were authorized for issue by the board of directors on March 26, 2012. The board of directors
have the power to amend and reissue the financial statements.
30
2011 Annual Report Walton Edgemont Development Corporation Notes to Financial Statements


2. Basis of Preparation
Statement of Compliance
These financial statements have been prepared in full compliance with International Financial Reporting Standards (IFRS)
and using accounting policies that are consistent with IFRS as issued by the International Accounting Standards Board
(IASB). As this is the first year of operations of the Corporation, these financial statements have also been prepared in
accordance with IFRS 1: First-time Adoption of International Financial Reporting Standards.
Basis of Presentation
The Corporations financial statements have been prepared on the historical cost basis, except for certain financial
instruments which are initially measured at fair value, as explained in the accounting policies set out in note 3.
The statement of financial position have been prepared using a liquidity based presentation because the operating cycle of
the Corporation revolves around the sale of land, the timing of which is uncertain. As a result, presentation based on liquidity
is considered by management to provide information that is more reliable and relevant to the users of the financial
statements. With the exception of land development costs (see note 4), land held for development (see note 5) and
debentures payable (see note 6), all assets and liabilities are current in nature and are expected to be settled in less than
twelve months.
3. Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions
that affect the reported amounts of assets, liabilities and equity, the disclosure of contingencies at the date of the financial
statements, and the reported amounts of revenue and expenses during the period. The estimates and assumptions that
have the most significant effect on the amounts recognized in the Corporations financial statements are as follows:
Recoverability of land held for development and land development costs
In assessing the recoverability of the land held for development and land development costs, management is required to
make estimates and assumptions regarding the sale price for serviced lots, the costs to service the lots, the timing of lot sales,
the completion date for the serviced lots and the Corporations cost of capital. Changes in these estimates and assumptions
could cause the amount of the recovery of land held for development and land development costs to differ materially from
the carrying amount of those assets.

31


Deferred tax asset
In assessing the amount of deferred tax assets to recognize, significant judgment is required in determining the amount of
deferred tax assets that can be recognized, based upon the likelihood, timing and level of future taxable profits. Changes in
the timing and level of future taxable profits could cause the amount of the deferred tax assets to be recovered to differ
materially from the carrying amount.
Land Development Costs

Land development costs are allocated to the land to which they relate. The Corporation capitalizes all direct costs related
to land development. These costs include borrowing (financing) costs such as interest on debt specifically related to the
development and property taxes, but exclude general and administrative overhead expenses. At the time sales are
recognized, the Corporation will also capitalize the estimated unexpended portion of costs relating to the lots that are sold.
Land development costs are then relieved through cost of land sold on a per acre basis.
Land development costs are assessed for indicators of impairment quarterly. When indicators of impairment exist, the
aggregate of the carrying value of land development costs and land held for development is compared against the net
realizable value. Where the carrying amount exceeds the net realizable value, the difference is recognized as an impairment
loss. If the impairment to the land development costs subsequently decreases, the recovery is capitalized to land held for
development to the extent of the improvement.
Land Held for Development

Land held for development has been designated by management as inventory property because it is the intention of the
Corporation to service the Properties, and to construct municipal services infrastructure on the Properties, for eventual
sale in the ordinary course of business. As inventory property, l and held for development is carried at acquisition cost,
which is based on the price paid by the Corporation for the Properties plus other direct purchase expenses. Land held for
development is relieved through cost of land sold on a per acre basis as sales are recognized.
Land held for development is assessed for indicators of impairment quarterly. When indicators of impairment exist, the
aggregate of the carrying value of land development costs and land held for development is compared against the net
realizable value. Where the carrying amount exceeds the net realizable value, the difference is recognized as an impairment
loss. If the impairment to the land development costs subsequently decreases, the recovery is capitalized to land held for
development to the extent of the improvement.
32


Borrowing Costs
General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets,
which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to
the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. The Corporation
considers land development costs and land held for development to be qualifying assets.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for capitalization.

Financial Instruments
Financial instruments are any contract that gives rise to a financial asset of one party and a financial liability or equity
instrument of another party. Financial assets and liabilities are recognized when the company becomes a party to the
contractual provisions of the instrument. Financial assets are derecognized when the rights to receive cash flows from the
assets have been transferred and the company has transferred substantially all risks and rewards of ownership. Financial
liabilities are derecognized when the obligation specified in the contract is discharged.
Financial instruments are recognized initially at fair value, which is the amount of consideration that would be agreed upon
in an arms length transaction between willing parties. Subsequent measurement depends on how the financial instrument
has been classified. Cash and other receivable are classified as loans and receivables, and are carried at amortized cost using
the effective interest rate method. Debentures payable, interest payable, trade payables and accrued liabilities, and due to
related parties have been classified as other financial liabilities and are carried at amortized cost using the effective interest
rate method.
Debentures Payable
Debentures payable are financial liabilities of the Corporation and are carried at amortized cost using the effective interest
rate method. Since the debentures payable were initially recognized at a discount, the effective interest rate on the
debentures payable exceeds the stated interest rate on the debentures. Interest is calculated on the carrying amount of
the debentures using the effective interest rate and is allocated to interest payable based on the stated interest rate,
with the balance being allocated to debentures payable.
The debentures payable issued by the Corporation are extendable at the option of the Corporation for a period of two years.
This extension feature is a loan commitment under International Accounting Standard 39: Recognition and Measurement
(IAS 39), and as a result, no asset or liability has been recognized is respect of this option.
Cash
Cash includes cash in the Corporations bank account.
33


Share Capital
Class A voting common shares (Class A shares) have been classified as equity because they represent residual assets
of the entity after the deduction of all its liabilities, and do not provide the holder of the shares with the right to put t he
shares back to the Corporation.
Class B shares issued by the Corporation have been classified as equity because the shares represent a residual interest in
the Corporation after the payment of all liabilities of the Corporation, and do not provide the holder of the shares with the
right to put the shares back to the Corporation. Costs directly attributable to the issuance of such shares are recognized as
a deduction from equity.
Revenue Recognition
Land is sold by way of an agreement of purchase and sale. Revenue is recognized on these sales once the agreement is duly
executed and delivered, the collection of sales proceeds is reasonably assured, the purchaser can commence construction,
and all other material conditions are met, including a deposit of not less than 20%.
Customer deposits received for purchases of lots on which revenue recognition criteria have not been met are recorded
as deferred revenue.
The Corporation recognizes interest income on an accrual basis in the period when it is earned.
Organizational Costs
Organizational costs represent the legal, accounting, audit, printing, filing, transfer agent and other costs incurred by the
Corporation associated with the IPO and Private Placement. These costs are expensed as incurred.
Current and Deferred Income Tax

Income tax expense for the period comprises current and deferred tax. Income tax is recognized in the statement of income
except to the extent that it relates to items recognized directly in other comprehensive income or directly in equity, in which
case the income tax is also recognized directly in other comprehensive income or equity, respectively.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted,
at the end of the reporting period, and any adjustment to tax payable in respect of previous years.
Deferred income tax is recognized using the liability method, recognized in respect of temporary differences between the
tax basis of assets and liabilities and their carrying amounts. Deferred income tax is determined using tax rates that have
been enacted, or substantially enacted, by the balance sheet date and are expected to apply when the related deferred
income tax asset is realized or the deferred income tax liability is settled. Deferred income tax assets are recognized only to
the extent that it is probable that future taxable profit will be available against which the temporary differences and unused
tax losses can be utilized.
34


Comprehensive Loss
Comprehensive loss consists of net loss and other comprehensive loss (OCL). OCL represents changes in shareholders
equity during a period arising from transactions and other events with non-owner sources, and includes exchange differences
on the translation of financial statements into the presentation currency, and changes in the fair value of the effective
portion of cash flow hedging instruments.
The Corporation did not have any OCL during the period ended December 31, 2011.
Future Changes in Accounting Policy

Financial instruments
IFRS 9: Financial Instruments (IFRS 9) was issued in November 2009 and addresses classification and measurement of
financial assets. It replaces the multiple category and measurement models in I AS 39 for debt instruments with a new mixed
measurement model having only two categories: amortized cost and fair value through profit or loss. Requirements for
financial liabilities were added to IFRS 9 in October 2010 and they largely carried forward existing requirements in IAS 39,
except that fair value changes due to credit risk for liabilities designated at fair value through profit and loss are generally
recorded in other comprehensive income.
IFRS 9 is effective for annual periods beginning after January 1, 2015, with early adoption permitted. The Corporation
will adopt IFRS 9 for the annual year beginning on January 1, 2015. The adoption of IFRS 9 will result in a change in the
classification of the Corporations financial assets from amortized cost to fair value through profit or loss, this change is
not expected to result in a material change to the carrying amount of these financial assets. IFRS 9 is not expected to result
in any changes to the classification or carrying amount the Corporations financial liabilities.
Fair value measurement
IFRS 13: Fair Value Measurement (IFRS 13) is a comprehensive standard for fair value measurement and disclosure for use
across all IFRS standards. The new standard clarifies that fair value is the price that would be received to sell an asset, or paid
to transfer a liability in an orderly transaction between market participants, at the measurement date. Under existing IFRS,
guidance on measuring and disclosing fair value is dispersed among the specific standards requiring fair value measurements
and does not always reflect a clear measurement basis or consistent disclosures.
IFRS 13 is effective for annual periods beginning after January 1, 2013, with early adoption permitted. The Corporation will
adopt IFRS 13 for the annual year beginning on January 1, 2013. As outlined in note 3, all financial instruments are initially
recognized at fair value and subsequently carried at amortized cost. The Corporation also discloses the fair value of financial
instruments in the notes to the financial statements. The adoption of IFRS 13 is not expected to result in any changes to the
measurement and disclosure of the fair value its financial instruments.

35


4. Land Development Costs

The following table provides a breakdown of costs capitalized to land development costs by nature as at December 31, 2011.
Planning (note 9)
Land development
Financing
Legal
Project management (note 8)
May 5,
2011
$
December 31,
2011
$
212,581
53,750
1,083,764
14,428
1,075
1,365,598
The timing of sales are uncertain because it is dictated by the timing of cash receipts by the Corporation, which is influenced
by factors that are beyond the control of management, such as market demand and the cash flows of our customers.
As a result, while a portion of land development costs could be current in nature, it is not possible for management to
reasonably estimate the portion that will be realized within the next twelve months.
5. Land Held for Development

Land held for development consists of the Corporations 100% interest in the Properties which were acquired during the
fourth quarter of 2011. On October 12, 2011, the Corporation acquired 117.93 acres of the Properties (Parcel C). In
consideration for Parcel C, the Corporation paid $14,987,226 to unrelated parties for 113.05 acres, and issued 68,079 Units
to Walton International Group Inc. (WIGI) for an equivalent value of $645,049 for the remaining 4.88 acres. The remaining
83.6 acres of the Property (Parcels A and B) were acquired on November 30, 2011 through the payment of $10,600,434
to unrelated parties for 79.96 acres, and the issuance of 52,060 Units to WIGI for an equivalent value of $493,268 for the
remaining 3.73 acres.
The timing of sales is uncertain because it is dictated by the timing of cash receipts by the Corporation, which is influenced by
factors that are beyond the control of management, such as market demand and the cash flows of our customers. As a result,
while a portion of land held for development could be current in nature, it is not possible for management to reasonably
estimate the portion that will be realized within the next twelve months.

36


6. Debentures Payable and Interest Payable

During the year, the Corporation issued 2,577,200 debentures as part of its IPO, 422,800 debentures as part of its Private
Placement, 68,079 debentures in exchange for WIGIs ownership interest in Parcel C, and 52,060 debentures in exchange for
WIGIs ownership interest in parcels A and B. The debentures are unsecured and bear interest at a rate of 8%. Interest on the
debentures is calculated based on the face value of the debentures on June 30, and is payable annually on September 30.
The debentures mature on December 31, 2016 at a face value of $7.50, although the maturity date can be extended by the
Corporation at its sole discretion until December 31, 2018. The Corporation may also, in its sole discretion, (i) repay all or
any portion of the principal amount of, or interest under, the debentures payable through the issuance of Class B shares,
(ii) evidence its obligation to pay all or any portion of the interest under the debentures through the issuance of Interest
debentures, and/or (iii) convert all or any principal amount of the offering debentures into Class B shares.
The following table reconciles the change in debentures payable during the period from May 5, 2011 to December 31, 2011.
December 31, 2011

$
BALANCE BEGINNING OF PERIOD
Debentures issued through the IPO
18,314,227
Debentures issued through Private Placement
2,972,813
Debentures issued in exchange for parcel C
483,786
Debentures issued in exchange for parcels A and B
369,952
Non-cash interest on the debentures
BALANCE END OF PERIOD
43,794
22,184,572
The debentures payable issued by the Corporation bear interest at a rate of 8% per annum. Interest is calculated based on
the face value of the debentures payable as at June 30 of each year, and is payable on September 30. The following table
reconciles the change in interest payable during the year:
December 31, 2011

$
BALANCE BEGINNING OF PERIOD
Accrued interest on the debentures payable
BALANCE END OF PERIOD

796,643
796,643

37


7. Financial Instruments
The Corporations financial instruments consist of other receivable, cash, debentures payable, interest payable, trade
payables and accrued liabilities and due to related parties. With the exception of debentures payable, the fair value of
these financial instruments approximate their carrying value due to the short-term nature of these items. The fair value
of debentures payable approximates the carrying amount because the interest rate on the debentures approximates the
interest rate on debentures issued by comparable entities.

a.) Risk overview
The Corporations financial instruments and the nature of the risks to which they may be subject are as set out in
the following table.
Risk
Credit
X
X
Other receivable
Cash
Debentures payable
Interest payable
Trade payables and accrued
liabilities
Due to related parties

b.) Credit risk
Liquidity
X
X
Interest rate
Currency
X
X
X
X
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing t o
discharge an obligation. Credit risk arises from cash held with banks and financial institutions, and other receivable.
While the maximum exposure to credit risk is equal to the carrying value of these financial instruments, management
believes the Corporations exposure to credit risk is minimal for the following reasons:
Other receivable - The balance of receivables outstanding is typically not material and is settled in accordance
with the terms of contract. The balance of other receivable as at December 31, 2011 was outstanding less than
90 days and considered collectible by the Corporation. Exposure to credit risk relating to these receivables is not
considered significant.
Cash - Cash is on deposit with a major financial institution, which substantially minimizes its exposure to
credit risk.

38


c.) Liquidity risk
Liquidity risk arises from the possibility that the Corporation will encounter difficulties in meeting its financial
obligations as they become due. The Corporation manages its liquidity risk by continuously monitoring the adequacy
of its capital resources (see note 13) and by managing cash receipts and payments. The liabilities which expose the
Corporation to liquidity risk are as follows:
Trade payables and accrued liabilities, and due to related parties These liabilities are a result of the normal
operations of the Corporation and are current in nature. Management considers exposure to liquidity risk from these
financial instruments to be minimal because the balances owing at December 31, 2011 will be funded by cash held by
the Corporation. The obligations relating to such future commitments will be funded through a combination of future
revenues generated by the Corporation, and the capital resources available to the Corporation, as disclosed in note 13.
Debentures payable and interest payable The Corporation manages the liquidity risk associated with the
debentures payable by continuously monitoring its working capital to ensure it has sufficient capital to fund the
annual interest payments due on the debentures payable. Such capital is derived from a combination of future
revenues generated by the Corporation, and the capital resources available to the Corporation, as disclosed in
note 13. The debentures have a maturity date of December 31, 2016, however, the maturity date can be
extended to December 31, 2018 at the sole discretion of the Corporation. The Corporation intends to repay
the debentures payable through future revenues generated by the Corporation.
Maturity Analysis of liabilities December 31, 2011

Between 91
> 1 year
Total
days and 1
< 90 days
year
Debentures payable ($)

Interest payable ($)
Trade payables and
accrued liabilities ($)
Due to related parties ($)
-
-

-
796,643
117,064
85,338
202,402
339,355
339,355
22,184,572

-
22,184,572

796,643
d.) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of
changes in market interest rates. The financial instruments of the Corporation which give rise to interest rate risk
are as follows:
Cash - Changes in market interest rates will cause fluctuations in the future interest earned on cash balances.
Any resulting impact on the Corporations financial results would not be considered material.
Debentures payable The debentures payable have a fixed 8% interest rate and, as a result, do not expose the
Corporation to any interest rate risk.
39


e.) Currency risk
The Corporation does not engage in foreign currency denominated transactions. As a result, it has no exposure
to currency risk.
8. Project Debt
The Corporation has a $29.2 million construction loan to help finance Phase 1 of the project. The construction loan
consists of a $26.9 million revolving demand loan, and $2.3 million letter(s) of credit. The loan facility is available to finance
the construction costs for Phase 1 of the project, while the letters of credit act as security for the completion of certain
obligations pursuant to the development agreements which will be signed with the City of Edmonton. This letter
of credit typically declines as the Corporations development obligations with the City of Edmonton are completed,
through a series of staged reductions over a period of time and are ultimately extinguished when the municipality has
issued final acceptance certificates.
The construction loan is due on demand and bears interest at a rate of prime + 1.25%, however, no interest is payable on this
loan until the interest reserve set out in the loan agreement is fully utilized. The lender reserves the right to stop advancing
from the interest reserve account if the loan is not in good standing. The construction loan is partially guaranteed by WIGI
and is also secured by a first priority security interest in all present and after acquired personal property of the Corporation,
a floating charge over all of the Corporation's present and after acquired real and other property, and a first fixed and specific
demand collateral land mortgage over the Properties.
9. Related Party Transactions

WAM, WIGI, WDM and 1389211 Alberta Ltd. are all related to the Corporation by virtue of common management.
The balances due to these related parties as at December 31, 2011 are outlined in the table below. With the exception of
the development fee payable to WDM and the amounts payable to WAM for the servicing fee, these amounts are unsecured,
due on demand, bear no interest and have no fixed terms of repayment. The development fee payable to WDM is payable
within 60 days of quarter-end. The servicing fee which is paid to WAM for distribution to the Corporations agents is payable
semi-annually.

Total
December 31, December 31,

2011
2011
$
$

267,477
59,050
69,695
1,253

2,183
-
339,355
60,303
May 5,
2011
$

The following transactions entered into between the related parties during the period were under terms and conditions
agreed upon between the parties.
40



On June 27, 2011, the Corporation and WAM entered into a Management Services Agreement. In accordance with the terms
of the Management Services Agreement, WAM will provide management and administrative services to the Corporation in
return for an annual management fee equal to:
i.) from July 15, 2011 until the earlier of the date of termination of the Management Services Agreement and June 30,
2016, 2% of the aggregate of:
a.) The net proceeds raised from the IPO of $24,032,390, calculated as the gross proceeds raise of
$25,772,000, net of selling commissions $1,353,030 and organizational costs of $386,580;
b.) The net proceeds raised from the Private Placement of $3,900,330, calculated as the gross proceeds
raised of $4,228,000, net of selling commissions $221,970, w ork fees of $42,280, and organizational costs
of $63,420; and;
c.) the product of the number of Units issued by the Corporation to WIGI in exchange for its interest in the
Property multiplied by $9.325 which was equal to $1,120,296; and
ii.) thereafter, from July 1, 2016 until the termination date of the Management Services Agreement, an amount equal
to 2% of the book value of the Properties.
Also in accordance with the Management Services Agreement, c ommencing on July 15, 2011 and continuing until the earlier
of the dissolution of the Corporation and June 30, 2016, the Corporation will pay to WAM a servicing fee equal to 0.50%
annually of the net proceeds for each Unit sold under the IPO and Private Placement. WAM is then responsible for paying the
servicing fee to the Corporations agents. The servicing fee is calculated from the date of the applicable closing, calculated
semi-annually and paid as soon as practicable after that date.
During the period from May 5, 2011 to December 31, 2011, the Corporation incurred total management fees of $247,007.
During the period from May 5, 2011 to December 31, 2011, the Corporation incurred total servicing fees of $60,552.
The balance payable to WAM as at December 31, 2011 was a result of the transactions disclosed above.

On September 30, 2011, WIGI acquired 37,440 Units of the Corporation for total consideration of $374,400 through the
Private Placement.
On October 12, 2011 WIGI acquired 68,079 Units in exchange for its ownership interest in Parcel C. On November 30, 2011,
WIGI acquired an additional 52,060 Units in exchange for its ownership interest in Parcel A and B. In accordance with the
terms of the Walton Contribution Agreement between WIGI and the Corporation, the Units issued to WIGI were issued at
a price of $9.475 per Unit, being the $10/Unit issue price paid by the Corporations unitholders, less the $0.525 in selling
commissions which neither WIGI nor the Corporation was obliged to pay as part of the land for Unit exchange.
As a result of the transactions noted above, WIGI owns approximately 5.1% of the outstanding Units of the Corporation.
As at December 31, 2011, the Corporation owed WIGI $267,477. This was comprised of land development costs and
other costs of the Corporation which were initially funded by WIGI on behalf of the Corporation but are reimbursable
by the Corporation.
41



On June 27, 2011, the Corporation and WDM entered into a Project Management Agreement. In accordance with the terms
of the Project Management Agreement, the fees and costs for services provided by WDM are divided into the following
two categories:
i.) WDM will receive a development fee, plus applicable taxes, equal to 2% of certain development costs incurred
in the calendar quarter, payable within 60-days of the end of such quarter.
ii.) WDM will receive a performance fee, plus applicable taxes, equal to 25% of cash distributions after all investors
of Units in the Corporation have received an cash payments or other distributions equal to $10.00 per Unit,
plus an 8% priority return. The priority return is calculated on that $10.00 amount, reduced by any cash payments
or distributions by the Corporation.
For the period from May 5, 2011 to December 31, 2011, the total development fee charged to the Corporation was $1,075.
This amount has been capitalized as part of land development costs
No performance fee was incurred by the Corporation during the period ended December 31, 2011 because the $10 per Unit
amount and the cumulative priority return have not been received by the investors of Units in the Corporation.
As at December 31, 2011, the balance owing to WDM was comprised of the development fee and land improvement costs,
which were paid for by WDM on behalf of the Corporation but are reimbursable by the Corporation.
1389211 Alberta Ltd.

On May 5, 2011, the Corporation issued to 1389211 Alberta Ltd. 100 Class A shares for total consideration of $100.
Key Management Compensation

Key management personnel are comprised of the Corporations directors and executive officers. The total compensation
expense incurred by the Corporation relating to its directors was a s follows:
Three months

For the period from
ended May 5, 2011 to
December 31, 2011
December 31, 2011
$
$
Director fees
13,032
34,339
All services performed for the Corporation by its executive officers are governed by the Management Services Agreement.
The annual management fee that WAM receives under the Management Services Agreement has been disclosed above.

42


10. Share Capital

Authorized
Unlimited Class A shares
Unlimited Class B shares

Outstanding
December 31, 2011

Number of
Amount
shares
$
May 5, 2011
Number of
Amount
shares
$
Class A shares
100
100
100
100
Class B shares
3,000,000
7,500,000
120,139
284,579
(404,320)
3,120,239
7,380,359
100
100
Class B shares issued in exchange for

land
Share issuance costs commissions and
work fees
All Class A shares of the Corporation are held by 1389211 Alberta Ltd., which is a related party of the Corporation by virtue of
common management.
Initial Public Offering and Private Placement

On June 27, 2011, the Corporation filed the Prospectus for the IPO of its Units. This was followed by a non-brokered Private
Placement of Units which was filed on July 18, 2011. The IPO and the Private Placement were successfully completed on
July 15, 2011 and December 31, 2011, respectively, resulting in the issuance of 3,000,000 Class B shares for gross proceeds
of $7,500,000 and the issuance of 3,000,000 debentures for gross proceeds of $22,500,000. The issuance costs associated
with the share component and debenture component were $404,320 and $1,212,960, respectively, and were comprised of
commissions paid to agents of $1,575,000 and the work fees pertaining to the Private Placement of $42,280. These costs
were allocated to the share component and debenture component, based on their proportionate share of the gross
proceeds raised.
Per Share Amount

Basic net loss per share is calculated by dividing the Corporations net loss by the weighted average number of shares
outstanding. Class A shares outstanding have not been included in the weighted average shares outstanding because the
Class A shares do not participate in the profits or losses of the Corporation. The weighted average number of shares
outstanding for the period ended December 31, 2011 was 2,006,269.

43


As the Corporation has the right to convert any portion of the debentures payable into Class B shares, this conversion feature
could result in potentially dilutive shares in the determination of the weighted average diluted shares outstanding. For the
period ended December 31, 2011, the potentially dilutive shares were nil because the Corporation generated a net loss
during the period.
Share Issuance Price

The Class A shares issued and outstanding of the Corporation were issued at a price of $1/share.
The Class B shares issued and outstanding of the Corporation were issued at a price of $2.50/share.
11. Income Taxes

The income tax recovery recognized by the Corporation during the period ended December 31, 2011 was comprised of
the following:
the period
For
from
May 5, 2011 to
December 31,
2011

Current tax
Deferred tax recovery

Income tax recovery

44
205,127
205,127


The tax recovery on the Corporations net loss before tax differs from the amount that would arise using the weighted
average tax rate applicable to losses as follows:
Net loss before tax
Applicable tax rate

Expected deferred tax recovery

Tax effects of:

Non-deductible expenses
Unit issuance costs and organizational costs
period from
For the
May 5, 2011 to
December 31, 2011
$
(767,116)
25%
(191,779)
112,500
(28,204)
Origination and reversal of timing differences

Income tax recovery
(97,644)
(205,127)
Deferred income tax assets are a result of temporary differences between the carrying amount of assets and liabilities in the
financial statements and their carrying amount for income tax purposes, as well as the recognition of tax losses for the period
from May 5, 2011 to December 31, 2011. The deferred income tax recovery recognized by the Corporation during the period
and its impact on the deferred income tax asset is as follows:

Change due to origination and reversal of temporary differences
97,644
Recognition of tax losses from current year
107,483
205,127
205,127
DEFERRED TAX ASSET MAY 5, 2011
DEFERRED TAX ASSET DECEMBER 31, 2011
As outlined in the Corporations accounting policies (note 3), deferred income tax assets are recognized only to the extent
that it is probable that future taxable profit will be available against which temporary differences and prior year tax losses
can be utilized. The nature of the Corporations business is such that until the sale of lots commences, any revenue generated
by the Corporation is not significant. Management feels that based on the level of commitments received for the purchase of
serviced lots and the anticipated costs required to complete the development of those serviced lots, the Corporation will be
able to recover the tax losses from the period May 5, 2011 to December 31, 2011 before the expiry date of the tax losses.
The full amount of the deferred tax asset is non-current because it is not expected to be recovered within twelve months.
45


12. Commitments
The following table presents future commitments of the Corporation under the Management Services and Agreement
(note 9) over the next five years. It does not include the performance fee payable to WAM under the Management Services
Agreement, which is determined at the time land sales are completed.
Servicing fee
$
2012
2013
2014
2015
2016
Management fee
$
Total
$
139,664
139,664
139,664
139,664
69,832
581,060
581,060
581,060
581,060
290,530
720,724
720,724
720,724
720,724
360,362
628,488
2,614,770
3,243,258
The commitment for the management fee will extend for the length of the project, however, after June 30, 2016, it is
calculated based on the book value of the Properties at the end of the previous calendar quarter, which cannot be reasonably
estimated at this time.
13. Capital Management

The Corporation has two sources of capital to finance its operations:
i.)
Of the gross proceeds raised under the IPO and Private Placement, approximately 9.1% ($2.7 million) was set aside
by the Corporation to pay for its ongoing administrative and operating expenses, management fee, development
fee, pre-development costs, grading costs, construction costs and other expenses of the Corporation. As at
December 31, 2011, the Corporation had total cash on hand of $2,074,371.
ii.) The Corporation has a construction loan to help finance Phase 1 of the project. The construction loan consists of a
$26.9 million non-revolving loan facility and $2.3 million letter(s) of credit. This loan is partially guaranteed by WIGI,
which is required to maintain a minimum level of net worth stated in the borrowing agreement. The total amount
drawn on the construction loan at December 31, 2011 was $nil (May 5, 2011 - $nil). It is anticipated that further
construction loans will be required to fund the costs of development for Phase 2, 3 and 4 of the project.
Management regularly reviews the levels of its capital resources to determine if sufficient cash is available to fund the
ongoing costs of the Corporation over the next twelve months. As at December 31, 2011, sufficient capital exists to fund
the Corporations activities for at least the next 12 months. WIGI monitors, on a monthly basis, its net worth to ensure
compliance with its obligations as a guarantor. As at December 31, 2011, WIGI was in compliance with this requirement,
and foresees no circumstances or conditions which may be reasonably likely to cause WIGI to be offside with its obligations
as guarantor over the next 12 months.
The Corporation is not subject to any externally imposed financial covenants.

46
Notes
47
Notes
48
Walton Group of Companies

The Walton Group of Companies constitutes one of North Americas leading land-based real estate
investment and development groups. Our professional teams research, acquire, syndicate, plan, develop
and manage land assets with the goal of achieving the highest and best potential of the land and in
doing so, maximizing returns for clients and investors.
In business for more than 30 years, the Walton Group currently manages approximately CAD $3.1 billion of pre-development and
development real estate assets, including nearly 65,000 acres of land in Alberta, Ontario, Arizona, Texas, Georgia, the Washington
D.C. area and Charlotte, North Carolina for the Walton Group and on behalf of investors around the world, including primarily North
America, Europe and Asia.
Headquartered in Calgary, the Walton Group has over 700 employees in Canada, the United States, Hong Kong, Singapore,
Malaysia and Germany.
Members of the Walton Group of Companies include:
is the manager of Walton Edgemont Development Corporation.
is the project manager for Walton Edgemont Development Corporation.
Walton Capital Management Inc.
is a registered exempt market securities dealer which distributed units for Walton Edgemont Development Corporation.
is a shareholder in the Walton Edgemont Development Corporation with a minory interest.
Walton Global Investments Ltd.
is the parent company of the Walton Group of Companies.
49
Jon N. Hagan
Director
Walton Edgemont
Development Corporation
Clifford H. Fryers
Director
Walton Edgemont
Cliff Fryers has been Chairman and

Chief Executive Officer of the White
Iron Group of Companies (a media
production house) since 1997. He is
also the chair of the board of the
Manning Centre for Building Democracy,
and is on the board of directors of
several companies in the Walton Group.
He was on the Board of Advisors of
Walton Global Investments Ltd. For
eight years, retiring as Vice Chairman
in November, 2011. Previously, Cliff
was Chief of Staff to the Leader of Her
Majestys Official Opposition in the
House of Commons. He was a Senior Tax
Partner and Managing Partner with law
firm Milner Fenerty (now Fraser Milner
Casgrain LLP), and he holds the ICD.D
certification granted by the Institute of
Corporate Directors.
Jon N. Hagan is principal of JN Hagan

Consulting, providing assistance to major
corporations regarding real estate capital
markets, and acquisition and disposition
transactions covering situations across
North America and China. He is also a
director and member of the audit and
executive committees of the board of
directors of First Capital Realty Inc. and is
a former director and member of various
committees of Bentall Kennedy Group.
Previously, he was a trustee of Sunrise
Senior Living Real Estate Investment Trust
and was the chair of the audit committee
thereof. He has also been Chairman of
Teranet Income Fund and a director and
on the audit committee of the board of
directors of The Mills Corporation. In
addition to board service, Jon has held
a number of executive finance positions
with real estate industry leaders including
Oxford, Cambridge Shopping Centres,
Empire Company Limited and Cadillac
Fairview Corporation. Jon is a chartered
accountant, holds a BSc in Mechanical
Engineering from the University of
Saskatchewan and attended the Executive
MBA program at the University of Alberta.
Chief Executive Officer

Walton Edgemont
Bill Doherty leads the Walton Group of

Companies as Chief Executive Officer of
Walton Global Investments Ltd., and as an
actively-involved Director and Executive
with several Walton Group affiliates.
Overseeing an innovative and dynamic
enterprise that has grown into a leading
North American real estate investment
and development group, Bill is deeply
involved in Waltons growing array of
business relationships with leading
international investment banks, brokerdealers, financial advisors and institutional
investors. He is central to Waltons
strategic direction and expansion and has
directed the launch of Waltons Asian,
USA and European operations; recruited
experienced industry leaders to form
Walton Development and Management
L.P.; and has overseen the diversification
of Waltons real estate portfolio from
an original base in Calgary to significant
positions in and around Edmonton,
Ottawa, Toronto, Phoenix-Tucson, DallasFort Worth, Austin-San Antonio, Atlanta,
the Washington D.C. area and Charlotte,
North Carolina.
Richard Singleton
Leslie L. Fryers, QC, ICD.D
D. Blair Nixon, QC, FCA, ICD.D
Richard R. Singleton was a lead

architectural partner with Cohos Evamy
Partners, Architects, Engineers and
Planners (now Dialogue Design) for 36
years. Since retiring in 2008, he has
consulted and provided assistance to
developers in various planning and
building projects. In addition, Richard
is on the board of directors of several
companies in the Walton Group. He is
presently a director of the National Music
Centre (Cantos Foundation), a member
of the Advisory Board of Thermal
Systems KWC. Ltd, a past member of
the Calgary Arts Development Authority
and a board member of a private real
estate investment group. He is a former
member of the Board of Advisors of
Walton Global Investments Ltd. Richard
holds a Bachelor of Architecture from
the University of Manitoba and is LEED
accredited.
Leslie Fryers, Executive Vice President,

Law for Walton Global Investments
Ltd., oversees the worldwide legal
services for the Walton Group of
Companies. Previously, Leslie enjoyed
three decades of successful private
practice, concentrating on mergers and
acquisitions. She has lectured extensively
at legal seminars, is a past Chair of the
Board of Directors of the Legal Education
Society of Alberta and is currently a
Member of The Association of General
Counsel of Alberta. Leslie was appointed
Queens Counsel by the Province of
Alberta, and has been granted the
ICD.D distinction from the Institute of
Corporate Directors. She is a Member of
the Law Society of Alberta, and holds a
Law degree from McGill University.
Blair Nixon is Chief Financial Officer of

Walton Global Investments Ltd., responsible
for finance operations across the Walton
Group of Companies. Mr. Nixon is both an
experienced tax lawyer and a chartered
accountant. He was Co-Managing Partner
of law firm Felesky Flynn LLP, where he
practiced tax law for 20 years. He is ranked
as a leading business lawyer by Chambers
Global, Lexpert and Martindale-Hubbell. He
has been a guest lecturer for the Canadian
Tax Foundation, the Institute of Chartered
Accountants of Alberta and the Canadian
Institute of Chartered Accountants. Mr.
Nixon is an elected Member and President
of the Council for the Institute of Chartered
Accountants of Alberta, and past Chair of
the Canadian Bar Associations National
Commodity Tax, Customs and Trade Section.
He was appointed Queens Counsel by
the Province of Alberta, awarded the FCA
designation by the Institute of Chartered
Accountants of Alberta, and holds the ICD.D
certification granted by the Institute of
Corporate Directors.
Director
Walton Edgemont
50
William (Bill) Doherty
Corporate Secretary
Walton Edgemont
Chief Financial Officer

Walton Edgemont
Register for Our Website

Visit Walton.com to access information on your investments with Walton International Group Inc.
and/or Walton Capital Management Inc.
Youll find:
Updates on your investment projects
Information about pending exit offers on your investments
Account holdings
Financial results
Videos and presentations
Waltons Privacy Policy
Go to Walton.com and select either Walton International Group Inc. or Walton Capital
Management Inc. to log in if you are a registered user. If you are not yet registered, select
New User in the top right hand corner and follow the registration instructions.
If you have any questions during the registration process,
please contact Investor Services at 1.866.925.8668.
51

Corporate Headquarters Calgary
23rd Floor, 605 - 5th Avenue SW
Calgary, Alberta, Canada T2P 3H5
Main: +1.403.265.4255
Fax: +1.403.237.6634
Toronto
Suite #100, 20 Carlson Court
Toronto, Ontario, Canada M9W 7K6
Main: +1.416.365.2790
Fax: +1.416.860.9962
Auditor
PricewaterhouseCoopers LLP
Suite 3100, 111 - 5th Avenue SW
Calgary, Alberta, Canada T2P 5L3
Main: +1.403.509.7500
Fax: +1.403.781.1825
Walton Investor Services

23rd Floor, 605 - 5th Avenue SW
Calgary, Alberta, Canada T2P 3H5
Main: +1.866.925.8668
Fax: +1.866.925.8663
InvestorServices@WaltonInternational.com
Walton.com

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ANNUAL REPORT

Walton Edgemont Development Corporation

Walton Edgemont Development Corporation Edmonton, Alberta

Walton Edgemont Development Corporation Edmonton, Alberta

CEO Message to Shareholders

2011 Annual Report Walton Edgemont Development Corporation

CEO Message to Shareholders

Northeast view of Walton Edgemont Development Corporation Fall 2011

2011 Annual Report Walton Edgemont Development Corporation

Edgemont Estates March 2012

2011 Annual Report Walton Edgemont Development Corporation

Managements Discussion & Analysis

Critical Accounting Estimates

Approval by the Board of Directors

The Corporations investment objectives are to:

Summary Financial Data

Total expenses ($)

Deferred income tax recovery ($)

Net loss and comprehensive loss ($)

Weighted average shares outstanding

Basic net loss per share ($)

Total assets ($)

Total non-current liabilities ($)

Total liabilities ($)

Total Equity ($)

Class B shares outstanding end of period

Initial Public Offering and Private Placement

Acquisition of the Properties

Land Development Costs

Servicing Fees and Commissions

Transactions with Related Parties

Walton International Group Inc.

Walton Asset Management L.P.

Walton Development and Management L.P.

Walton Asset Management L.P.

Walton International Group Inc.

Walton Development and Management L.P.

1389211 Alberta Ltd.

Key Management Compensation

For the period from

Walton Edgemont Development Corporation Key Project Milestones for Phase 1

Complete underground utility

Anticipated completion date

May July, 2011

Completed in March 2012

August September, 2011

Initiated in December 2011

May September, 2011

June August, 2011

September December, 2011

Obtain subdivision plan registration

Complete roadway construction (onsite

May June, 2012

Completed in November 2011

Lot Activity Report

Review of Fourth Quarter Operations

Summary of Quarterly Results

Three months ended

Total assets ($)

Total liabilities ($)

Total expenses ($)

Deferred tax recovery ($)

Total equity/(deficit) ($)

Net income (loss) and comprehensive income (loss) ($)