UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, D.C. 20549





FORM 20-F





(Mark One)




o
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934





OR





x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended  December 31, 2012





OR




o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





OR




o
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




Date of the event requiring this shell company report________________________





For the transition period from ___________________ to ____________________




Commission file number
000-13391





SAMEX MINING CORP.(Exact name of Registrant as specified in its charter)British Columbia, Canada(Jurisdiction of incorporation or organization)#301 – 32920 Ventura Avenue, Abbotsford, British Columbia, Canada V2S 6J3(Address of principal executive offices)Sasan Sadeghpour, Director, Chairman, Interim CEO

Tel: (604) 870-9920 Facsimile: (604) 870-9930

#301 – 32920 Ventura Avenue, Abbotsford, British Columbia, Canada V2S 6J3(Name, telephone, e-mail and/or facsimile number and address of Company contact person)





Securities registered or to be registered pursuant to Section 12(b) of the Act: None





Securities registered or to be registered pursuant to Section 12(g) of the Act:




Common Shares, without par value(Title of Class)





Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:




Not Applicable(Title of Class)








Indicate the number of outstanding shares of each of the Registrant’s classes of capital of common stock as of December 31, 2012: 126,733,719 Common Shares




Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.


o  Yes  x  No





If this report is an annual report or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.


o  Yes  x  No





Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.


x  Yes  o  No





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


o  Yes  o  No





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






Large accelerated filer  o
Accelerated filer   o
Non-accelerated filer  x





Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:




U.S. GAAP

International Financial Reporting Standards as issued by the International Accounting Standards Board
x

Other





If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.Item 17
Item 18





If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)




o  Yes  x  No







1





SAMEX MINING CORP.


FORM 20-F




TABLE OF CONTENTS




PageItem 1.
Identity of Directors, Senior Management and Advisers


6Item 2.
Offer Statistics and Expected Timetable


6Item 3.
Key Information


6Item 4.
Information on the Company


21Item 5.
Operating And Financial Review And Prospects


34Item 6.
Directors, Senior Management And Employees


49Item 7.
Major Shareholders And Related Party Transactions


56Item 8.
Financial Information


60Item 9.
The Offer And Listing.


61Item 10.
Additional Information.


62Item 11.
Quantitative And Qualitative Disclosures About Market Risk.


78Item 12.
Description Of Securities Other Than Equity Securities.


78Item 13.
Defaults, Dividend Arrearages And Delinquencies.


79Item 14.
Material Modifications To The Rights Of Security Holders And Use Of Proceeds.


79Item 15.
Controls And Procedures


79Item 16A.
Audit Committee Financial Expert.


80Item 16B.
Code Of Ethics.


81Item 16C.
Principal Accountant Fees And Services.


81Item 16D.
Exemptions From The Listing Standards For Audit Committees.


81Item 16E.
Purchase Of Equity Securities By The Issuer And Affiliated Purchases.


81Item 17.
Financial Statements


82Item 18.
Financial Statements


82Item 19.
Exhibits.


109
  2
 
 
 SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS


This Annual Report on Form 20-F and the exhibits attached hereto contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements concern the Company’s anticipated results and developments in the Company’s operations in future periods, planned exploration and development of its properties, plans related to its business and other matters that may occur in the future. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Statements concerning reserves and mineral resource estimates may also be deemed to constitute forward-looking statements to the extent that they involve estimates of the mineralization that will be encountered if the property is developed, and in the case of mineral reserves, such statements reflect the conclusion based on certain assumptions that the mineral deposit can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects” or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “estimates” or “intends”, or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” (or the negative and grammatical variations of any of these terms and similar expressions) be taken, occur or be achieved,) are not statements of historical fact and may be forward-looking statements. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ from those expressed or implied by the forward-looking statements, including, without limitation:




·
risks related to our status as a passive foreign investment company for U.S. tax purposes;


·
risks related to our history of operating losses;


·
risks related to our lack of production history;


·
risks related to our limited financial resources;


·
risks related to our need for additional financing;


·
risks related to competition in the mining industry;


·
risks related to increased costs;


·
risks related to possible shortages in equipment;


·
risks related to mineral exploration activities;


·
risks related to our lack of insurance for certain activities;


·
risks related to all our properties being in the exploration stage;


·
risks related to uncertainty that our properties will ultimately be developed;


·
risks related to fluctuations in precious and base metal prices;


·
risks related to the possible loss of key management personnel;


·
risks related to our mineral properties being subject to prior unregistered agreements, transfers, or claims and other defects in title;


·
risks related to governmental and environmental regulations;


·
risks related to our ability to obtain necessary permits;


·
risks related our status as a foreign corporation;


·
risks related to current economic conditions; and


·
other risks related to our securities.





This list is not exhaustive of the factors that may affect our forward-looking statements. Some of the important risks and uncertainties that could affect forward-looking statements are described further in the sections entitled “Risk Factors”, “Information on the Company” and “Operating and Financial Review and Prospects” and in the exhibits attached to this Annual Report on Form 20-F. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward-looking statements. The Company’s forward-looking statements are based on beliefs, expectations and opinions of management on the date the statements are made and the Company does not assume any obligation to update forward-looking statements if circumstances or management’s beliefs, expectations or opinions change, except as required by law. For the reasons set forth above, investors should not place undue reliance on forward-looking statements.





All references in this Report on Form 20-F to the terms “we”, “our”, “us”, “the Company” and “SAMEX” refer to SAMEX Mining Corp. and its subsidiaries.




3








CONVERSION TABLE




In this Annual Report a combination of Imperial and metric measures are used. Conversions from Imperial measure to metric and from metric to Imperial are provided below:





Imperial Measure     =

Metric Unit

Metric Measure     =

Imperial Unit2.47 acres

1 hectare

0.4047 hectares

1 acre3.28 feet

1 meter

0.3048 meters

1 foot0.62 miles

1 kilometer

1.609 kilometers

1 mile0.032 ounces (troy)

1 gram

31.1 grams

1 ounce (troy)1.102 tons (short)

1 tonne

0.907 tonnes

1 ton0.029 ounces (troy)/ton

1 gram/tonne

34.28 grams/tonne

1 ounce (troy/ton)




4








CURRENCY AND EXCHANGE RATES




Canadian Dollars Per U.S. Dollar




The following table sets out the exchange rates for one United States dollar (“US$”) expressed in terms of Canadian dollars (“Cdn$”) in effect at the end of the following periods, and the high, low and average values for such periods. Exchange rates are based upon the daily noon rate reported by the Bank of Canada.




Canadian Dollars Per U.S. Dollar3-Month Period Ended

December 31,2012
2011
2010
2009
2008
2012
2011End of period
0.9949
1.0170
0.9946
1.0466
1.2246
0.9949
1.0170Average for the period
0.9996
0.9891
1.0299
1.1420
1.0660
0.9913
1.0232High for the period
1.0418
1.0604
1.0778
1.3000
1.2969
1.0028
1.0604Low for the period
0.9710
0.9449
0.9946
1.0292
0.9719
0.9763
0.9935





The following table sets out the high and low exchange rates for one United States dollar (“US$”) expressed in terms of Canadian dollars (“Cdn$”) during the months from October 2012 to March 2013. Exchange rates are based upon the daily noon rate reported by the Bank of Canada.




For the month of:
October

2012
November

2012
December

2012
January

2013
February

2013
March

2013High for the period
1.0004
1.0028
0.9952
1.0078
1.0285
1.0314Low for the period
0.9763
0.9927
0.9841
0.9839
0.9960
1.0156





The noon rate of exchange onApril 26, 2013 as reported by the Bank of Canada for the conversion of United States dollars into Canadian dollars was US$1.00 = Cdn$1.0170. Unless otherwise indicated, in this Annual Report on Form 20-F (the “Annual Report” or “Form 20-F”), all references herein are to Canadian Dollars.





Chilean Pesos Per US Dollar





The tables below set out the average of the Observed US Dollar Exchange Rate expressed in terms of the number of Chilean Pesos per US dollar for the following periods, reported by the Central Bank of Chile:





Yearly Average of Chilean Pesos Per U.S. Dollar





Calendar Year
Average For Year2008
1 US$ = 521.79 pesos2009
1 US$ = 559.61 pesos2010
1 US$ = 510.25 pesos2011
1 US$ = 483.36 pesos2012
1 US$ = 486.75 pesos





Monthly Average of Observed US Dollar Exchange Rate expressed in terms of Chilean Pesos Per U.S. Dollar for Year 2012





Month
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
DecPesos
501.34
481.49
485.40
486.00
497.09
505.63
491.93
480.99
474.97
475.36
480.57
477.13





Monthly Average of Observed US Dollar Exchange Rate expressed in terms of Chilean Pesos Per U.S. Dollar for Year 2013





Month
Jan
Feb
MarPesos
472.67
472.34
472.48




5








PART I




ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS




Not Applicable.




ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE




Not Applicable.




ITEM 3. KEY INFORMATION




We were incorporated as Silver Duke Mines Ltd. (N.P.L.) on December 15, 1967 under the Company Actof British Columbia (the “Company Act”). We changed our name to Totem Resources Ltd. (N.P.L.) on February 3, 1976 and subsequently to Paragon Resources Ltd. (N.P.L.) on June 9, 1978. On May 13, 1981, we became a limited company instead of a specially limited company and our name became Paragon Resources Ltd. We changed our name to SAMEX Mining Corp. on September 11, 1995. On March 29, 2004, the Company Act was repealed and was replaced by the Business Corporations Act (British Columbia). Because of this change, we replaced our former Memorandum of Incorporation with new Notice of Articles on February 11, 2005. We also amended our Articles to conform to the new legislation and changed our authorized share capital by eliminating the maximum number of common shares and preferred shares that the Company is authorized to issue, effective June 13, 2005. Also during 2005, the Company changed its fiscal year-end from November 30th to December 31st. (see Item 4 “Information on the Company - History and Development of the Company”).





SAMEX Mining Corp. is a junior resource company engaged in the acquisition and exploration of mineral properties in South America, particularly in the country of Chile. The Company focuses its exploration activities on the search for deposits of precious and base metals.





In Chile, the Company holds an interest in the Los Zorros district copper-gold-silver prospects, the Chimberos copper-gold-silver prospects, the Inca copper, gold, silver and molybdenum prospects, and the Espejismo gold prospects (see Item 4 “Description of Property” for individual property details). We are an exploration stage company and have no mineral producing properties at this time. All of our properties are exploration projects, and we receive no revenues from production. All work presently planned by us is directed at defining mineralization and increasing our understanding of the characteristics and economics of that mineralization. There is no assurance that a commercially viable ore deposit exists in any of our properties until further exploration work and a comprehensive evaluation based upon unit cost, grade, recoveries and other factors conclude economic feasibility.





SAMEX is a reporting issuer in British Columbia and Alberta and its common shares trade in Canada on the TSX Venture Exchange under the symbol SXG. The Company’s common shares are also quoted in the United States on the OTCQB tier of the OTC Link under the symbol SMXMF.




3.A Selected financial data.




Conversion To International Financial Reporting Standards (“IFRS”)





The consolidated financial statements of the Company for the fiscal year ended December 31, 2012 are reported under International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board. As result of the Accounting Standards Board of Canada’s decision to adopt International Financial Reporting Standards for publicly accountable entities for financial reporting periods beginning on or after January 1, 2011, the Company's financial statements for the year ended December 31, 2011 were the first annual financial statements of the Company under IFRS. Prior to fiscal 2011, the Company applied the available standards under previous Canadian Accepted Accounting Principles ("Canadian GAAP") that were issued by the Accounting Standards Board of Canada. The effects of the conversion from Canadian GAAP to IFRS were identified in Note 12 "Transition To IFRS" of our consolidated financial statements for year ended December 31, 2011 previously filed in our 2011 Annual Report on Form 20F filed with the SEC. As required by IFRS 1 “First-time Adoption of International Financial Reporting Standards”, January 1, 2010 was considered to be the date of transition to IFRS by the Company. Therefore, the comparative figures that were previously reported under previous Canadian GAAP for the 2010 fiscal year were restated in accordance with IFRS. Our consolidated financial statements have been prepared in Canadian dollars and in accordance with IFRS which differs in significant respects from Canadian GAAP and from the generally accepted accounting principles in the United States ("U.S. GAAP"). As such, discussion of our financial condition and results of operations is based on the results prepared in accordance with IFRS.




6








Pursuant to International Financial Reporting Standards, during the year ended December 31, 2012 management concluded that the functional currency of the Company's subsidiary, Minera Samex Chile S.A., is the Chilean Peso and not the Canadian dollar as it was previously designated to be, and accounted for this accordingly. In consideration of the effects of the difference in foreign exchange translation and to reflect the Chilean Peso being identified as the functional currency of Minera Samex Chile S.A., the consolidated statements of financial position as at December 31, 2011 and January 1, 2011 and the consolidated statements of comprehensive loss and cash flows for the year ended December 31, 2011 have been restated to reflect the Chilean peso as the functional currency of Minera Samex Chile S.A. See the consolidated financial statements for the year ended December 31, 2012, Note 13 "Restatement", for these adjustments made for fiscal 2011.





The following data for the fiscal years ended December 31, 2012, 2011, and 2010 is derived from our audited consolidated financial statements, which were prepared in accordance with International Financial Reporting Standards ("IFRS") which differs in significant respects from Canadian GAAP and U.S. GAAP. The following selected financial data has been extracted from the more detailed consolidated financial statements included elsewhere herein (stated in Canadian Dollars, being the foreign currency our financial statements are denominated in,
 see “Currency and Exchange Rates”) and is qualified in its entirety by, and should be read in conjunction with, the consolidated financial statements and notes thereto included elsewhere herein. The following information should be read in conjunction with “Item 5. Operating and Financial Review and Prospects”.





IFRS

Fiscal Year Ended December 312012


2011


2010Restated - Note 13 Financial StatementsNet operating revenueLoss from operations

$
(1,866,307
)

$
(4,142,106
)

$
(1,163,026
)Net loss for the year


(1,446,975
)


(3,708,873
)


(1,091,350
)Loss from operations per share


(0.02
)


(0.03
)


(0.01
)Total assets


21,772,354



22,397,380



19,116,519Current assets


3,531,045



9,918,174



9,010,220Capital stock


50,038,530



50,033,530



44,702,328Number of shares


126,733,719



126,708,719



119,467,719Dividends per common share

NIL


NIL


NILBasic and diluted net loss percommon share

$
(0.02
)

$
(0.03
)

$
(0.01
)





The following selected financial data has been extracted from the audited consolidated financial statements (previously filed with our Annual Reports on Form 20-F) for the 2009 and 2008 fiscal years, which were prepared in accordance with Canadian GAAP and reconciled to U.S. GAAP which differs in significant respects from accounting principles in IFRS. There are also several material differences between Canadian GAAP and U.S. GAAP that are applicable to the financial information summarized here for the 2009 and 2008 fiscal years.





US GAAP

Fiscal Year Ended December 312009


2008Net operating revenueLoss from operations

$
(1,591,785
)

$
(1,154,945
)Comprehensive loss for the year


(5,827,672
)


(2,731,764
)Loss from operations per share


(0.02
)


(0.03
)Total assets


1,132,085



423,117Current assets


1,061,603



311,614Capital stock


1,058,367



318,889Number of shares


96,856,665



81,261,165Dividends per common share

NIL


NILBasic and diluted net loss percommon share

$
(0.07
)

$
(0.03
)




7







Canadian GAAP

Fiscal Year Ended December 312009


2008Net operating revenueLoss from operations

$
(1,591,785
)

$
(1,154,945
)Comprehensive loss for the year


(4,282,770
)


(2,571,737
)Loss from operations per share


(0.02
)


(0.03
)Total assets


10,154,038



11,125,120Current assets


1,061,603



311,614Capital stock


10,080,320



11,020,892Number of shares


96,856,665



81,261,165Dividends per common share

NIL


NILBasic and diluted net loss percommon share

$
(0.05
)

$
(0.03
)





See “Currency and Exchange Rates” for disclosure of exchange rates between Canadian dollars and United States dollars. Unless indicated otherwise, all references to dollars in this annual report are to Canadian dollars.





3.B Capitalization and indebtedness.




Not Applicable.





3.C. Reasons for the offer and use of proceeds.




Not Applicable.





3.D. Risk factors.




In addition to other information in this Annual Report on Form 20-F, the following risk factors should be carefully considered in evaluating our business because such factors currently may have a significant impact on our business, operating results and financial condition. As a result of the risk factors set forth below and elsewhere in this Report, and the risks discussed in our other Securities and Exchange Commission filings, actual results could differ materially from those projected in any forward – looking statements. See “Special Note Regarding Forward Looking Statements”.





We have a history of losses.




We have historically incurred losses and have no revenue from operations. We incurred losses from operations of $1,866,307 for the fiscal year ended December 31, 2012 and $4,142,106 for the fiscal year ended December 31, 2011. As of December 31, 2012, we had a cumulative deficit of $34,652,026. There can be no assurance that either the Company or any of our subsidiaries will achieve profitability in the future or at all.





We have not identified any commercially viable mineral deposits. We have not commenced development or commercial production on any of our properties. We have no history of earnings or cash flow from operations. We do not have a line of credit and our only present source of funds available may be through the sale of our equity shares or assets. Even if the results of exploration are encouraging, we may not have the ability to raise sufficient funds to conduct further explorations to determine whether a commercially mineable deposit exists on any of our properties. While additional working capital may be generated through the issuance of equity or debt, the sale of our properties, the possible optioning or joint venturing of our properties, and/or the sale of royalty interests or capital assets, we cannot assure you that any such funds will be available for operations on acceptable terms, if at all.




8








In addition, should we be unable to continue as a going concern, realization of assets and settlement of liabilities in other than the normal course of business may be at amounts significantly different from those contained in our financial statements.





We have no production history from our mineral properties.




We have no history of producing metals from any of our properties as each of our properties are in the exploration stage. Advancing properties from exploration into the development stage requires significant capital and time, and successful commercial production from a property, if any, will be subject to completing positive feasibility studies, permitting and construction of the mine, processing plants and roads and other related works and infrastructure. As a result, we are subject to all the risks associated with developing and establishing new mining operations and business enterprises including:





·
Completion of feasibility studies to define reserves and commercial viability, including the ability to find sufficient mineral reserves to support a commercial mining operation;


·
The timing and cost, which can be considerable, of further exploration, preparing feasibility studies, permitting and construction of infrastructure, mining and processing facilities;


·
The availability and costs of drill equipment, qualified exploration personnel, skilled and reliable labour and mining and processing equipment, if required;


·
The availability and cost of appropriate smelting and/or refining arrangements, if required;


·
Compliance with environmental and other governmental approval and permit requirements;


·
The availability of funds to finance exploration, development and construction activities, as warranted;


·
Potential opposition from non-governmental organizations, environmental groups, local groups or local inhabitants which may delay or prevent development activities; and


·
Potential increases in exploration, construction and operating costs due to changes in the cost of fuel, power, materials and supplies.





The costs, timing and complexities of exploration, development and construction activities may be increased by the location of our properties and demand by other mineral exploration and mining companies. It is common in exploration programs to experience unexpected problems and delays during drill programs and, if warranted, development, construction and mine start-up. Accordingly, our activities may not result in profitable mining operations and we may not succeed in establishing mining operations or profitability producing metals at any of our properties.





We generally have limited financial resources and no source of cash flow.




Although we believe we have sufficient funds to meet our current obligations, we currently have no external sources of liquidity, and all additional funding required for our activities for the foreseeable future will be obtained from the sale of our securities. Should we elect to satisfy our cash commitments through the issuance of securities, by way of either private placement or public offering, there can be no assurance that our efforts to raise such funding will be successful, or achieved on terms favourable to us or our shareholders. Such financings, to the extent they are available, may result in substantial dilution to our existing shareholders. Failure to obtain additional financing on a timely basis could cause us to forfeit all or a portion of our interests in the assets or rights now held by usand our ability to continue as a going concern.As described in Note 1to our consolidated financial statements, our consolidated financial statements have been prepared on the assumption that we will continue as a going concern, meaning that we will continue in operation for the foreseeable future, and will be able to realize assets and discharge our liabilities in the ordinary course of operations. There can be no assurance that we will be able to continue as a going concern.





Our success depends on our ability to raise additional capital.




As of December 31, 2012, we had working capital of$3,337,197(December 31, 2011:$9,828,964).During fiscal 2011, we raised proceeds of $4,675,500 from the exercise of warrants and proceeds of $60,000 from the exercise of stock options. During fiscal 2012, we raised proceeds of $5,000 from the exercise of warrants for the purchase of 25,000 shares at $0.20 per share.




9








Based on the cash on hand, we believe we have sufficient funds to conduct our general operations over the next year, however we may require additional capital to fund our exploration programs over the next year. Beyond that time, it will be necessary to raise additional financing in order to fund our ongoing general operations and exploration programs. We propose to raise the required funds through the issuance of securities, by way of either private placement, exercise of warrants, or by public offering. Although we anticipate that we will be able to complete equity placements sufficient to meet our capital requirements, there can be no assurance that we will be able to do so on terms favorable to us or at all. Failure to obtain additional financing on a timely basis could cause us to forfeit all or a portion of our interests in the assets or rights now held by us and our ability to continue our operations.





The business of mineral exploration is highly competitive and there is no assurance we can compete with other competitors for financing, qualified personnel and other resources related to the operation of our business.




Significant competition exists for the limited number of property acquisition opportunities available. As a result of this competition, some of which is with large established mining companies with substantial capabilities and greater financial and technical resources than our Company, we may be unable to acquire attractive mining properties on terms we consider acceptable. Competition in the precious metals mining industry is primarily for mineral rich properties which can be developed and exploited economically; the technical expertise to find, develop, and produce such properties; the labor to operate the properties; and the capital for the purpose of funding such properties. Many competitors not only explore for and mine precious metals and minerals but conduct refining and marketing operations on a worldwide basis. Such competition may result in our being unable to acquire desired properties, to recruit or retain qualified employees or to acquire the capital necessary to fund our operations and develop our properties. Our inability to compete with other mining companies for these resources may have a material adverse effect on our results of operation and business. There can be no assurance that our exploration and acquisition programs will yield any reserves or result in any commercial mining operation.





Our operations are subject to the inherent risk associated with mineral exploration activities.




Mineral exploration activities and, if warranted, development activities generally involve a high degree of risk, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. Environmental hazards, industrial accidents, unusual or unexpected geological formations, fires, power outages, labor disruptions, flooding, explosions, cave-ins, land slides and the inability to obtain suitable or adequate machinery, equipment or labor are other risks involved in the operation of mines and the conduct of exploration programs. Operations and activities in which we have a direct or indirect interest will be subject to all the hazards and risks normally incidental to exploration, development and production of precious and base metals, any of which could result in work stoppages, damage to or destruction of mines, if any, and other producing facilities, damage to life and property, environmental damage and possible legal liability for any or all damage. We plan to obtain insurance, in amounts that we consider to be adequate, to protect ourselves against certain of these mining risks once we commence mining operations. However, we may become subject to liability for certain hazards which we cannot insure against or which we may elect not to insure against because of premium costs or other reasons. The payment of such liabilities may have a material, adverse effect on our financial position. At the present time, we do not conduct any mining operations and none of our properties are under development, and, therefore, we do not carry insurance to protect us against certain inherent risks associated with mining. Reclamation requirements vary depending on the location and the managing regulatory agency, but they are similar in that they aim to minimize long-term effects of exploration and mining disturbance by requiring the operating company to control possible deleterious effluents and to re-establish to some degree pre-disturbance landforms and vegetation.





Increased costs could affect our financial condition.




We anticipate that costs at our projects that we may explore or develop, will frequently be subject to variation from one year to the next due to a number of factors, many of which are outside of our control. A material increase in costs at any significant location could have an effect on our operations.




10








A shortage of equipment and supplies could adversely affect our ability to operate our business.




We are dependent on various supplies and equipment to carry out our mining exploration and, if warranted, development operations. The shortage of such supplies, equipment and parts could have a material adverse effect on our ability to carry out our operations and therefore limit or increase the cost of production.





Mineral exploration involves a high degree of risk against which we are not currently insured.




The Company’s exploration activities are subject to the hazards and risks normally incident to the exploration for and development and production of precious minerals, any of which could result in damage for which the Company may be held responsible. Hazards such as unusual or unexpected weather, rock formations, formation pressures, fires, power outages, landslides, flooding cave-ins or other adverse conditions such as the inability to obtain suitable or adequate machinery, equipment or labor may be encountered in the drilling and removal of material. While we may obtain insurance against certain risks in such amounts as we consider adequate, the nature of these risks is such that liabilities could exceed policy limits or could be excluded from coverage. There are also a number of risks against which we cannot insure or against which we have decided not to insure, due to high premiums or for other reasons. Should such liabilities arise, they could reduce or eliminate any future profitability and result in increasing costs and a decline in the value of our common shares. We do not currently maintain insurance against risks relating to our mineral property interests.





All of our properties are in the exploration stage and are highly speculative in nature, which means there can be no assurance that our programs will result in the discovery of any economically feasible mineral deposit.




At present, none of our properties have a known body of ore and all our proposed exploration programs are an exploratory search for ore. We will only develop our mineral properties if we obtain satisfactory results from our exploration programs. The development of gold, silver, copper and other mineral properties is affected by many factors, including the cost of operations, variations in the grade of ore mined, fluctuations in metal markets, costs of processing equipment and other factors such as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection. We have relied and may continue to rely upon consultants and others for exploration expertise. Substantial expenditures are required to establish reserves through drilling, to develop metallurgical processes to extract the metal from the ore and, in the case of new properties, to develop the mining and processing facilities and infrastructure at any site chosen for mining. We cannot assure you that any mineral deposits will be discovered in sufficient quantities to justify commercial operations or that funds required for development can be obtained on a timely basis. Depending on the price of gold, silver, copper or other minerals produced, if any, we may determine that it is impractical to commence or, if commenced, continue commercial production.





The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be accurately predicted, such as market fluctuations, the global marketing conditions for gold and silver and other metals, the proximity and capacity of milling facilities, mineral markets and processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting minerals and environmental protection. Our properties are located in the country of Chile which imposes certain requirements and obligations on the owners of exploratory properties and mineral exploration activities are subject to certain risks which are described elsewhere in this section.





Very few mineral properties are ultimately developed into producing mines.




The business of exploration for minerals and mining involves a high degree of risk such as unusual or unexpected geological formations and the inability to obtain suitable or adequate machinery, equipment or labour and is highly speculative in nature. Few properties that are explored are ultimately developed into commercially viable mining operations. At present, our existing properties have no known significant body of commercial ore. Most exploration projects do not result in the discovery of commercially mineable deposits of ore. The occurrence of unsuccessful exploration efforts may eventually lead to us needing to cease operations.




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The success of commodity exploration is determined in part by the following factors:





·
Identification of potential mineralization based on superficial analysis;


·
Exploration permits, as granted by the various government bodies;


·
Experience and quality of management and geological consultants; and


·
Capital available for exploration activity.





Substantial expenditures are required for us to establish proven and probable ore reserves through drilling and analysis, to develop metallurgical processes, to extract the metal from the ore and, in the case of new properties, to develop the mining and processing facilities and infrastructure at any site chosen for mining. In making the determination as to the commercial viability of a mineral deposit, a number of factors are considered, which include, without limitation, the particular attributes of the deposit, such as size, grade, and proximity to infrastructure; metal prices, which fluctuate widely; and government regulations, including, without limitation, regulations relating to prices, taxes, royalties, land tenure and use, importing and exporting or minerals and environmental protection.





Although substantial benefits may be derived from the discovery of a major mineral deposit, no assurance can be given that we will discover minerals in sufficient quantities to justify commercial operations or that we can obtain the funds required for development on a timely basis.





We may invest significant capital and resources in exploration activities and abandon such investments if we are unable to identify commercially exploitable mineral reserves. The decision to abandon a project may have an adverse effect on the market value of our securities and the ability to raise future financing.





We have no producing mines at this time.





Calculations of mineral reserves and of mineralized material are estimates only, subject to uncertainty due to factors including metal prices, inherent variability of the ore, and recoverability of metal in the mining process.




There is a degree of uncertainty attributable to the calculation of reserves and corresponding grades dedicated to future production. Until mineral reserves are actually mined and processed, the quantity of ore and grades must be considered as an estimate only. In addition, the quantity of mineral reserves and ore may vary depending on metal prices. Estimates of mineral resources under Canadian guidelines are subject to uncertainty as well. The estimating of mineral reserves and mineral resources under Canadian guidelines is a subjective process and the accuracy of such estimates is a function of the quantity and quality of available data and the assumptions used and judgments made in interpreting engineering and geological information. There is significant uncertainty in any reserve or estimate of mineral resources under Canadian guidelines, and the actual deposits encountered and the economic viability of mining a deposit may differ materially from our estimates. Estimated mineral reserves or mineral resources under Canadian guidelines may have to be recalculated based on changes in metal prices, further exploration or development activity or actual production experience. This could materially and adversely affect estimates of the volume or grade of mineralization, estimated recovery rates or other important factors that influence estimates of mineral reserves or mineral resources under Canadian guidelines. Any material change in the quantity of mineral reserves, mineralization, grade or stripping ratio may affect the economic viability of our properties. In addition, there can be no assurance that metal recoveries in small-scale laboratory tests will be duplicated in larger scale tests under on-site conditions or during production.





Theprices of precious metals and base metals directly impact on our business activities.




Our business activities are significantly affected by the prices of precious metals and base metals on international markets. The price of minerals affects our ability to raise financing, the commercial feasibility of our properties, the future profitability of our properties should they be developed and our future business prospects. The prices of precious metals and base metals fluctuate widely and are affected by numerous factors beyond our control, including expectations with respect to the rate of inflation, the strength of the U.S. dollar and of other currencies, interest rates, and global or regional political or economic crisis. The demand for and supply of precious metals and base metals may affect precious metals and base metals prices but not necessarily in the same manner as supply and demand affect the prices of other commodities.





Our business is affected by market fluctuations in the prices of minerals sought (gold, silver, and copper), which are highly volatile. Depending on the price of gold, silver, copper or other metals, we may determine that it is impractical to continue our exploration activities or, if warranted, to commence commercial development or production of our properties, if a mineral deposit is identified.




12








Gold, silver, and copper prices may fluctuate widely and are affected by numerous industry factors, such as demand for precious metals, forward selling by producers, central bank sales and purchases of gold and production and cost levels in major mineral-producing regions. Moreover, mineral prices are also affected by macro-economic factors that are beyond our control, including international economic and political trends, expectations of inflation, currency exchange fluctuations (specifically, the Canadian dollar relative to other currencies), interest rates and global or regional consumption patterns, speculative activities and increased production due to improved mining and production methods. We cannot assure you that the price of gold, silver, or copper will remain stable or that such prices will be at a level that will prove feasible to continue our exploration activities, or, if applicable, begin development of our properties.





The current demand for and supply of precious metals and base metals affects their prices, but not necessarily in the same manner as current demand and supply affect the prices of other commodities. If metal prices should decline for a sustained period, we could determine that it is not economically feasible to continue our exploration activities and such decision will have a material adverse affect on our business and results of operations.





The prices of gold, silver, and copperand other metals have fluctuated in recent years.The volatility of the prices for precious metals and base metals is illustrated by the following charts from kitco.com which show the market prices (US$) of gold, silver, and copper over the last five years.




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The loss of key management personnel may adversely affect our business and results of operations.




The success of our operations and activities is dependent to a significant extent on the efforts and abilities of our management: Sasan Sadeghpour, Chairman and Interim Chief Executive Officer, Juan Carlos Toro Taylor, Chief Geologistand Larry McLean, Interim Chief Financial Officer. Investors must be willing to rely to a significant extent on their discretion and judgment. We do not maintain key employee insurance on any of our employees.





There may be defects in the title to our properties.




In accordance with mining industry practice, we attempt to acquire satisfactory title to our properties but have not obtained title insurance with the attendant risk that some titles, particularly titles to undeveloped properties, may be defective. In accordance with mining industry practice, we have not obtained title insurance on the Chilean concessions held byus.The Company carries out all normal procedures to obtain title and make a conscientious search of mining records to confirm that the Company has satisfactory title to the properties it has acquired by staking, purchase or option, and/or that satisfactory title is held by the optionor/owner of properties the Company may acquire pursuant to an option agreement, and/or that satisfactory title is held by the owner of properties in which the Company has earned a percentage interest in the property pursuant to a joint venture or other type of agreement. However, the possibility exists that title to one or more of the concessions held by the Company, or an optionor/owner, or the owner of properties in which the Company has earned a percentage interest, might be defective for various reasons. The Company will take all reasonable steps to perfect title to any particular concession(s) found to be in question.





All of our properties are in the exploration stage and are highly speculative in nature, which means there can be no assurance that our programs will result in the discovery of any economically feasible mineral deposit.




At present, none of our properties have a known body of ore and all our proposed exploration programs are an exploratory search for ore. We will only develop our mineral properties if we obtain satisfactory results from our exploration programs.




The development of gold, silver, copper and other mineral properties is affected by many factors, including the cost of operations, variations in the grade of ore mined, fluctuations in metal markets, costs of processing equipment and other factors such as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals and environmental protection. We have relied and may continue to rely upon consultants and others for exploration expertise. Substantial expenditures are required to establish reserves through drilling, to develop metallurgical processes to extract the metal from the ore and, in the case of new properties, to develop the mining and processing facilities and infrastructure at any site chosen for mining. We cannot assure you that any mineral deposits will be discovered in sufficient quantities to justify commercial operations or that funds required for development can be obtained on a timely basis. Depending on the price of gold, silver, copper or other minerals produced, if any, we may determine that it is impractical to commence or, if commenced, continue commercial production.




The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be accurately predicted, such as market fluctuations, the global marketing conditions for gold, silver and copper, the proximity and capacity of milling facilities, mineral markets and processing equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting minerals and environmental protection. Our properties are located in the country of Chile which imposes certain requirements and obligations on the owners of exploratory properties which includes, among other things, certain application and permit requirements, certain limitations on mining and exploration activities, periodic reporting requirements, limited terms and certain fees and royalty payments.




15








There are certain specific risks associated with mineral exploration activities and property ownership in Chile.




The process for acquiring an interest in mineral concessions in Chile is different from procedures for acquiring mining claims in Canada or the United States and involves certain risks not applicable in those jurisdictions.





The rights and obligations associated with mining concession in Chile are governed by legislation and protected by the Chilean Political Constitution enacted in 1980 (the “Constitution”). Article 19, No 24 of the Constitution, which assures the right of property, in its different forms over corporal or intangible assets, includes mining concessions within this protection.





Law No 18.097 of January 21, 1982, which has constitutional rank, regulates the granting of mining concessions and defines the mining concessions as a real and immovable right, distinctive and independent from property rights over the surface tenements, although owned by the same individual. Such rights may be claimed against the State and any other person, may be transferred or transmitted, and may be mortgaged or subject to other real rights and, in general, to all acts and contracts.





A mining concession may be granted for exploring or exploiting mineral substances, the latter also being known as a mining claim. All metallic and non-metallic substances and, in general, all fossil substances, regardless of their natural state, may be subject to concessions or claimed, including those in the subsoil of maritime waters under national jurisdiction, to which access may be had, through tunnels, from land. Liquid or gaseous hydrocarbons, lithium or deposits of any kind in maritime waters under national jurisdiction or deposits of any kind entirely or partly embraced by areas which, under law have been classified as important, for mining reasons, to national security, are generally excluded from mining concessions, without prejudice to mining concessions validly granted prior to their exclusion or a resolution that classifies them as being important to national security.





Any person is entitled to dig test holes and to take samples in search for mineral substances, regardless of ownership or property rights over the tenements, except in lands included within the limits of a mining concession granted to a third party.





The object of a mining concession is all substances over which a concession may be granted, lying within its limits. The territorial area of a mining concession comprises a solid whose upper surface is, along a horizontal plane, a parallelogram with right angles and of an indefinite depth within the vertical planes that limit it. The area of an exploitation concession may not cover more than 10 hectares and an exploration concession may not exceed 5,000 hectares. The owner of the concession can hold any number of mining concessions that comply with the maximum surface indicated above.





Mining concessions are established by a judicial decree given following a non adversarial proceeding, without the decisory participation of any other authority or third party.





In order keep a mining concession valid and in effect, it is necessary to pay an annual license fee (patent). The patent payments must be made in advance during the month of March of each year. Patent fee are calculated based upon the value of the Chilean Monthly Tax Unit (“M.T.U.”) which varies from month to month. In the case of an exploitation concession the annual patent fee is calculated as one-tenth (1/10th) of the Monthly Tax Unit per hectare (for example, in March 2013 the M.T.U. was 40,085 x 1/10th = 4,008.5 Chilean Pesos per hectare which, at the Observed US$/Peso exchange rate of 472 at April 29, 2013 equated to approximately US$8.50 per hectare for exploitation concessions). In the case of an exploration concession the annual patent fee is calculated as one-fiftieth (1/50th) of the Monthly Tax Unit per hectare (for example, in March 2013 the M.T.U. was 40,085 x 1/50th = 801.7 Chilean Pesos per hectare which, at the Observed US$/Peso exchange of 472 rate at April 29, 2013 equated to approximately US$1.7 per hectare for exploration concessions). Should the holder of the concession fail to pay the fee within the designated period, judicial procedures to publicly auction the concession may be instituted.





A foreign corporation may hold mining rights over mining concessions in Chile without restrictions and without any discrimination regarding Chilean nationals.





Regulatory matters could impact our ability to conduct our business in Chile.




As our operations are primarily related to the exploration of our properties, many governmental regulations relating to mining activities are not yet applicable to us.




16








Our potential mining processing operations and exploration activities in Chile are subject to various laws governing land use, the protection of the environment, prospecting, development, production, exports, taxes, labour standards, occupational health, mine safety and other matters. Such operations and exploration activities are also subject to substantial regulation under these laws by governmental agencies and may require that we obtain permits from various governmental agencies. We believe we are in substantial compliance with all material laws and regulations which currently apply to our activities. There can be no assurance, however, that all permits which we may require for future operations will be obtainable on reasonable terms or that such laws and regulations would not have an adverse effect on any mining project which we might undertake.





Failure to comply with laws and regulations may result in orders being issued thereunder which may cause operations to cease or be curtailed or may require installation of additional equipment. Violators may be required to compensate those suffering loss or damage by reason of their mining activities and may be subject to fines or penal sanctions if convicted of an offense under such legislation.





Amendments to current laws and regulations governing operations and activities of mining companies or more stringent implementation thereof could have a material adverse impact on us or prevent development of our mining properties.





Chilean environmental legislation requires that the mining concessionaire obtains the prior authorization from the applicable environmental authorities to initiate any exploration or exploitation activity and for this purpose the mining concessionaire shall need to present an environmental assessments or an environmental impact study. Chilean environmental legislation defines the requisites that these studies have to fulfill, and the general mechanisms for controlling and ensuring compliance with such legislation. These reports entail a detailed technical and scientific assessment of the site and surrounding environmental as well as a prediction of the impact of proposed development on the environment. Such authorizations and reports can add to the cost and time frame associated with any potential project development.





Environmental legislation in Chile imposes potential liability on owners and/or operators of mining facilities which release hazardous substances into the environment and are required to carry out their operations using methods and techniques not liable to cause damage to the environment or the land-owner.





Foreign investments in Chile can be repatriated under the Foreign Investment Regulations contained in Decree Law 600, the Foreign Investment Statute, which is based on the principle of non discrimination between foreign and local investors. Foreign investors may enter into a foreign investment contract with the Republic of Chile where the terms of the investments, access to foreign currency, tax matters and other importation and exportation terms can be agreed upon for a term of 10 years or 20 years, if the investment is of an amount that exceeds US$50,000,000. Chile and Canada entered into a Free Trade Agreement (“FTA”), which has been in effect since July 5, 1997. This FTA enables Canadian investors to export products of Canadian origin into Chile without paying any custom duties and obtain relief under the double taxation provision, pursuant to which taxes paid in Chile on income generated by operations in Chile, including mining, will be used as a tax credit for the taxes levied in Canada on such income.





At present, the income of corporations, limited liability companies and mining companies is taxed in two stages; first, when income is accrued and or perceived, in a yearly basis, the corporate income is taxed with an income tax at a rate of 20% which was established in the year 2011 and future years; and second, when profits are distributed and remitted abroad to shareholders or partners without domicile in Chile, these profits are subject to a 35% Additional Tax rate, with a credit for the income tax paid by the corporation in Chile equivalent to 20% as stated above. The foregoing taxes may affect the future profitability of any potential mining operations on our properties. Operations in the mining sector may also be subject to an additional taxation, the Mining Royalty. Pursuant to Law 20.026 (published in the Official Gazette dated June 16, 2005), amended by Law 20.469 a Royalty Payment was incorporated into the Income Tax Law which established an specific taxation to mining exploitation, known as “Mining Royalty”. This specific tax is to be paid by any individual or legal entity who exploits concessionable mineral substances and sells any mineral products. This specific tax applies to any mining exploitation in which annual sales exceed 50,000 metric tons of fine copper, applying in this case a tax rate which ranges from 0.5% to 34.5%, calculated over fine copper per ton and operational margins, when they exceed 80.000 metric tons. This rate decreases if the annual production of fine copper is less than 50,000 metric tons of fine copper and more than 12,000 metric tons of fine copper, in which case the amount that exceeds the 12,000 metric tons and is less than 15,000 metric tons will be taxed at a rate of 0.5%. There is a scale in relation to production and sales up to the amount of 50,000 metric tons of fine copper per year and exceeds this amount over 85.000 metric tons of fine copper as indicated. In addition, to determine this Royalty, the mining concessionaire is entitled to deduct from the income generated in the sale of the mining products, all the costs necessary to produce the income, in accordance with the terms contemplated in the Income Tax Law. If additional special taxes or royalties were to be imposed in the future upon operations in the mining sector, this may affect the future profitability of any potential mining operations on our properties.




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Foreign currency exchange is regulated by the Central Bank of Chile under Chapter XIV of its Foreign Exchange Regulations. Currently there is no restriction on bringing investments or credits into Chile, provided that such investments and credits are registered with the Central Bank of Chile in accordance with Chapter XIV of The Foreign Exchange Regulations. Credits granted for periods of over 1 year are subject to a stamp tax of 0.4% of the amount of the loan and the Stamp Tax also will affect loans granted for less than 1 year at a reduce rate of 0.033% per month. Interest on loans granted by banks and financial institutions are subject to a 4% tax levied upon remittance of the interest payment to the lender bank or financial institution. If the loans granted to a Company in Chile by the lender Bank is greater than 3 times the capital of the Company, the interest charged that exceeds 3 times the capital will be subject to a 35% of Additional Tax.





Currency exchange rate fluctuations could adversely affect our operation.




The functional currency of our parent company, SAMEX Mining Corp., is the Canadian Dollar, and we have obligations and commitments in other currencies including Chilean Pesos and United States Dollars. Fluctuations in foreign currency exchange rates may affect our results of operations and the value of our foreign assets, which in turn may adversely affect reported financial figures and the comparability of period-to-period results of operations. (See “Currency and Exchange Rates”)





We are a foreign corporation, which may make enforcement of civil liabilities difficult.




We are incorporated under the laws of the Province of British Columbia, Canada. All of our assets are located outside of the United States. Consequently, it may be difficult for United States investors to realize in the United States upon judgments of United States courts predicated upon civil liabilities under the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”). A judgment of a US court predicated solely upon such civil liabilities would probably be enforceable in Canada by a Canadian court if the US court in which the judgment was obtained had jurisdiction, as determined by the Canadian court, in the matter. There is substantial doubt whether an original action could be brought successfully in Canada against us predicated solely upon such civil liabilities.





We do not intend to pay cash dividends.




We have never, and we do not have any intention of paying cash dividends in the foreseeable future. In particular, there can be no assurance that our Board of Director’s will ever declare cash dividends, which action is completely within their discretion.





We havereserved 32,926,888common shares for future issuance, which if issued may cause dilution in the value of currently issued and outstanding shares.




As of April 26, 2013 we reserved 10,895,000 common shares for issuance on the exercise of incentive stock options (at a weighted average exercise price of $0.55). In addition we reserved 22,031,888 common shares for issuance upon the exercise of outstanding warrants (at a weighted average exercise price of $0.61). If such options and warrants are fully exercised, such common shares would constitute 26% of our share capital. The exercise of such options and the subsequent resale of such common share in the public market could adversely affect the prevailing market price and our ability to raise equity capital in the future at a time and price which it deems appropriate. We may also enter into commitments in the future which would require the issuance of additional common shares and we may grant additional share purchase warrants and stock options. See Item 6. “Compensation – Incentive Stock Options”




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Likely Passive Foreign Investor Company (“PFIC”) Status Has Possible Adverse Tax Consequences for U.S. Investors





Current holders of and potential investors in our common shares who are U.S. taxpayers should be aware that SAMEX believes it was a passive foreign investment company (“PFIC”) for the tax year ended December 31, 2012 and may also be a PFIC in subsequent tax years. If SAMEX is a PFIC for any year during a U.S. taxpayer’s holding period, then such U.S. taxpayersgenerally will be required to treat any so-called “excess distribution” received on its common shares, or any gain realized upon a disposition of common shares, as ordinary income and to pay an interest charge on a portion of such distributions or gain, unless the taxpayer makes a qualified electing fund (“QEF”) election or a mark-to-market election with respect to the shares of SAMEX. In certain circumstances, the sum of the tax and the interest charge may exceed the amount of the excess distribution received, or the amount of proceeds of disposition realized, by the taxpayer. A U.S. taxpayer who makes a QEF election generally must report on a current basis its share of SAMEX’s net capital gain and ordinary earnings for any year in which SAMEX is a PFIC, whether or not SAMEX distributes any amounts to its shareholders. However, U.S. taxpayers should be aware that there can be no assurance that we will satisfy record keeping requirements that apply to a QEF, or that we will supply U.S. taxpayers with information that such U.S. taxpayers require to report under the QEF rules, in event that we are a PFIC and a U.S. taxpayers wishes to make a QEF election. Thus, U.S. taxpayers may not be able to make a QEF election with respect to their common shares. Each U.S. taxpayer should consult its own tax advisor regarding the availability of, and procedure for making, a QEF election. A U.S. taxpayer who makes the mark-to-market election generally must include as ordinary income each year the excess of the fair market value of the common shares over the taxpayer’s basis therein. U.S. taxpayers are advised to seek the counsel of their professional tax advisors.This paragraph is qualified in its entirety by the discussion below under the heading “Taxation—Certain United States Federal Income Tax Considerations.” Each U.S. taxpayer should consult his or her own tax advisor regarding thePFIC rules.See Item 10. “Taxation – Certain United States Federal Income Tax Considerations”.





Economic conditions and fluctuation and volatility of stock price may negatively impact shareholder value.





The market price of our common shares is highly volatile. If investors’ interest in the sector in which we operate declines, the price for our common shares would likely also decline. In addition, trading volumes in our common shares can be volatile and if the trading volume of our common shares experiences significant changes, the price of our common shares could be adversely affected. The price of our common shares could also be significantly affected by other factors, many of which are beyond our control.





Fluctuations in economic conditions, such as the continuing downturn in the global economy, may also significantly affect our ability to meet our objectives which could adversely affect our share price.





The trading market for our shares is not always liquid.




Although our shares trade on the TSX Venture Exchange and the OTCQB tier of the OTC Link, the volume of shares traded at any one time can be limited, and, as a result, there may not be a liquid trading market for our shares.




Broker-dealers may be discouraged from effecting transactions in our shares because they are considered a penny stock and are subject to the penny stock rules.




Rules 15g-1 through 15g-9 promulgated under the Exchange Act impose sales practice and disclosure requirements on certain brokers-dealers who engage in certain transactions involving “a penny stock.” Subject to certain exceptions, a penny stock generally includes any non-NASDAQ equity security that has a market price of less than US$5.00 per share. The market price of our shares during the fiscal year ended December 31, 2012 and thereafter to April 26, 2013 ranged betweenCDN$0.81andCDN$0.10and our shares are deemed penny stock for the purposes of the Exchange Act. The additional sales practice and disclosure requirements imposed upon brokers-dealers may discourage broker-dealers from effecting transactions in our shares, which could severely limit the market liquidity of the shares and impede the sale of our shares in the secondary market.





Under the penny stock regulations, a broker-dealer selling penny stock to anyone other than an established customer or “accredited investor,” generally, an individual with net worth in excess of US$1,000,000 or an annual income exceeding US$200,000, or US$300,000 together with his or her spouse,must make a special suitability determination for the purchaser and must receive the purchaser’s written consent to the transaction prior to sale, unless the broker-dealer or the transaction is otherwise exempt. In addition, the penny stock regulations require the broker-dealer to deliver, prior to any transaction involving a penny stock, a disclosure schedule prepared by the United States Securities and Exchange Commission relating to the penny stock market, unless the broker-dealer or the transaction is otherwise exempt. A broker-dealer is also required to disclose commissions payable to the broker-dealer and the registered representative and current quotations for the securities. Finally, a broker-dealer is required to send monthly statements disclosing recent price information with respect to the penny stock held in a customer’s account and information with respect to the limited market in penny stocks.




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As a foreign private issuer, our shareholders may have less complete and timely data.




The Company is a “foreign private issuer” as defined in Rule 3b-4 of the Exchange Act. Equity securities of the Company are accordingly exempt from Sections 14(a), 14(b), 14(c), 14(f) and 16 of the Exchange Act pursuant to Rule 3a12-3 of the Exchange Act. Therefore, the Company is not required to file a Schedule 14A proxy statement in relation to the annual meeting of shareholders. The submission of proxy and annual meeting of shareholder information on Form 6-K may result in shareholders having less complete and timely information in connection with shareholder actions. The exemption from Section 16 rules regarding reports of beneficial ownership and purchases and sales of common shares by insiders and restrictions on insider trading in our securities may result in shareholders having less data and there being fewer restrictions on insiders’ activities in our securities.





We are subject to recent market events and conditions




During 2012, the global economy was still experiencing the after-shocks of the 2008-2009 financial crisis and ensuing recession, as well as the impact of measures taken to counteract its effects. In response to the crises, many governments engaged in broad economic stimulus activities and expansionist monetary policies, resulting in large fiscal deficits and unprecedented levels of government debt and slow or negative growth and persistent high levels of unemployment. These and other factors gave rise to mounting concern over the possibility of sovereign debt default and a systemic financial failure in the Euro-zone resulting in broader financial contagion. In addition, new concerns began to develop over the appearance of asset bubbles, a general slowdown in China and other developing economies, the uncertainty regarding the "fiscal cliff" and United States spending cuts, and the unprecedented measures taken in Cyprus. Although the United States and certain other countries began to show signs of moderate growth during 2012, and the Euro-zone successfully avoided or contained its most serious financial threats, these concerns and the underlying financial conditions that gave rise to them, persisted throughout 2012, although in a more muted form.





In light of, and likely in response to these and other factors, the price of gold, which rose to over $1,900/oz. during 2011, before dropping back to $1,700 range, continued to rise somewhat during 2012, although with considerable volatility. The price of silver, which rose to over $48 in 2011, ending the year around $30, rose slightly during 2012, although, again, with considerable volatility. Although, the market for shares of junior precious metal explorers also improved briefly with the increase in precious metal prices, the market for the shares of junior exploration companies declined significantly in 2012, making it much more difficult for companies to raise capital for exploration. While this did not have a direct effect on the Company during 2012, since we had sufficient funds to cover our general operations and exploration programs during the year, it may impact our future operations since we are dependent upon our ability to access capital markets in order to fund our general operations and exploration programs.In April 2013, gold and silver experienced a dramatic price drop over a two week period that resulted in a negative outlook for junior exploration companies such as ours that will make it difficult for us to raise equity capital in the immediate short term and possibly longer should the market for precious and other metals continue to remain volatile. Therefore additional capital may not be available on terms acceptable to us or at all.





We are subject to general global economic conditions




The recent unprecedented events in global financial markets have had a profound impact on the global economy. Many industries, including the gold mining industry, are impacted by these market conditions. Some of the key impacts of the current financial market turmoil include devaluations and high volatility in global equity, commodity, foreign exchange and precious metal markets, and a lack of market liquidity. A continued or worsened slowdown in the financial markets or other economic conditions, including but not limited to, consumer spending, employment rates, business conditions, inflation, fuel and energy costs, consumer debt levels, lack of available credit, the state of the financial markets, interest rates, and tax rates may adversely affect our growth and profitability. Specifically:




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·
Adverse global credit/liquidity conditions could impact the cost and availability of financing and our overall liquidity;


·
the volatility of gold, silver and copper prices may impact our revenues, profits and cash flow;


·
volatile energy prices, commodity and consumables prices and currency exchange rates impact potential production costs; and


·
the devaluation and volatility of global stock markets impacts the valuation of our equity securities





These factors could have a material adverse effect on our financial condition and results of operations. Furthermore, as result of on-going global financial conditions, numerous financial institutions have gone into bankruptcy or have been rescued by government authorities. As such, the Company is subject to the risk of loss of its deposits with financial institutions that hold the Company's cash.




ITEM 4. INFORMATION ON THE COMPANY




4.A. History and Development of the Company.




Samex Mining Corp. was originally incorporated as Silver Duke Mines Ltd. (N.P.L.) on December 15, 1967 under the Company Act of British Columbia, Canada. We changed our name and consolidated our share capital as set forth below on the following dates:




Date

Name

Consolidation (Old:New)December 15, 1967

Silver Duke Mines Ltd. (N.P.L.)

Not applicableFebruary 3, 1976

Totem Resources Ltd. (N.P.L.)

4:1June 9, 1978

Paragon Resources Ltd. (N.P.L.)

Not applicableMay 13, 1981

Paragon Resources Ltd.

Not applicableSeptember 11, 1995

SAMEX Mining Corp.

5:1





Effective May 28, 1999, we increased our authorized capital from 100,000,000 shares divided into 50,000,000 common shares without par value and 50,000,000 preferred shares without par value, none of which preferred shares are issued, to 150,000,000 shares divided into 100,000,000 common shares without par value and 50,000,000 preferred shares without par value, none of which preferred shares are issued. We subsequently increased our authorized share capital to an unlimited number of shares in conjunction with the change in our articles described below.





Change in Articles





On March 29, 2004, the corporate legislation under which we were incorporated, the Company Act (British Columbia), was repealed and was replaced with the new Business Corporations Act (British Columbia). Because of this change, we were required to undertake certain transitional steps set out under the Business Corporations Act, including filing a Transition Application, which, among other things, replaced our former Memorandum of Incorporation with new Notice of Articles and which adopted certain provisions under the Business Corporations Act known as the “Pre-existing Company Provisions”. This step was completed on February 11, 2005. We were also required to amend our Articles to comply with the new legislation. Coincidentally with these changes, we also altered our authorized share structure to eliminate the maximum number of common shares and preferred shares that the Company is authorized to issue, effective June 13, 2005. See Item 10. “Additional Information – Changes to Corporate Legislation”.




Change In Year-End




During the fourth quarter of fiscal 2005,we changed the Company’s fiscal year-end to synchronize it with the year-end of our Chilean subsidiary and with the quarter ends of our Bolivian subsidiaries. The change helps make the Company’s accounting and reporting process more streamlined and efficient. The Company’s old financial year-end of November 30th was extended one additional month and the Company’s new financial year-end is now December 31st.




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Subsidiaries





We have six subsidiaries, described below, five of which are inactive and are in the process of being wound-up or disposed of. The present inter-corporate relationship between us and our subsidiaries is illustrated in the following chart:









* We are currently in the process of winding up our Bolivian operations and winding up or disposing of these subsidiaries. See "Wind-up Of Bolivian Subsidiaries" below.





Minera Samex Chile S.A.





Minera Samex Chile S. A. (“Samex Chile”) was incorporated in Santiago, Chile on July 5, 2002. The directors and officers of Samex Chile are: Sasan Sadeghpour, Silvana Airol Molinari and Juan Cristobal Necochea. Of the 1,000 issued and outstanding common shares, 999 shares are held by SAMEX Mining Corp. and 1 share is held by Francisco Vergara, our Chilean legal counsel. Samex Chile’s principal assets are its interest in mineral concessions at the Los Zorros, Chimberos, Inca, and Espejismo properties in Chile.





South American Mining & Exploration Corp.




South American Mining & Exploration Corp. (“S.A.M.E.X. Corp.”) was incorporated in British Columbia on November 24, 1993. S.A.M.E.X. Corp. was involved principally in the acquisition and exploration of mineral properties through its operating subsidiaries in Bolivia. Its authorized share capital consists of 100,000,000 common shares with 7,925,001 shares outstanding, all of which are held by us. See "Wind-up Of Bolivian Subsidiaries" below.




SAMEX International Ltd.




SAMEX International Ltd. (“SAMEX International”) was incorporated as an international business company under the laws of the Commonwealth of the Bahamas on August 4, 1995. The directors and officers of SAMEX International are Patricio Kyllmann (Director, President and Secretary) and Kenneth Taves (Director). Its authorized share capital consists of 5,000 common shares of which 100 are issued and outstanding, all of which are held by S.A.M.E.X. Corp. SAMEX International functions as an international holding and finance company and holds 98% of the shares of each of SAMEX S.A. and Emibol S.A. See "Wind-up Of Bolivian Subsidiaries" below.




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SAMEX S.A.




SAMEX S.A. was incorporated under the laws of the Republic of Bolivia on May 10, 1994. SAMEX S.A. has authorized capital of 500,000 Bolivianos (“Bs.”) and paid up capital of 250,000 Bs. represented by 100 common shares issued with a nominal value of 2,500 Bs. each. Of the 100 issued and outstanding shares, 98 are held by SAMEX International and the remaining 2 shares are held by each of Jeffrey Dahl and Peter Dahl, former directors of SAMEX. SAMEX S.A.’s only asset was its interest in a portion of the Goya I/El Bonete concessions which formed the Santa Isabel property which we abandoned subsequent to the year ended December 31, 2012. See "Wind-up Of Bolivian Subsidiaries" below.





Bolivex S.A.




Minas Bolivex S.A. (“Bolivex S.A.”) was incorporated under the laws of the Republic of Bolivia on September 23, 1994. Bolivex S.A. has authorized capital of 500,000 Bs. and paid up capital of 250,000 Bs. represented by 100 common shares issued with a nominal value of 2,500 Bs. each. Of the 100 issued and outstanding shares, 98 are held by S.A.M.E.X. Corp. and the remaining 2 shares are held by each of Jeffrey Dahl and Peter Dahl, former directors of SAMEX. Bolivex S.A’s. only asset, was the Walter Property that we abandoned in the first quarter of 2009. See "Wind-up Of Bolivian Subsidiaries" below.




Emibol S.A.




Empresa Minera Boliviana S. A. (“Emibol S.A.”) was incorporated under the laws of the Republic of Bolivia on August 22, 1995. Emibol S.A. has authorized capital of 200,000 Bs. and paid up capital of 100,000 Bs. represented by 100 common shares issued with a nominal value of 1,000 Bs. each. Of the 100 issued and outstanding shares, 98 are held by SAMEX International and the remaining 2 shares are held by each of Jeffrey Dahl and Peter Dahl, former directors of SAMEX. Emibol S.A.’s assets were its interests in the El Desierto Property and Eskapa Property that we abandoned subsequent to the year ended December 31, 2012. See "Wind-up Of Bolivian Subsidiaries" below.





Wind-up Of Bolivian Subsidiaries





Subsequent to the end of the 2012 fiscal year, we decided to abandon and write-off our Bolivian properties (Santa Isabel, Eskapa, El Desierto) and to close our remaining Bolivian operations. As a result, we are now in the process of winding up and closing our Bolivian subsidiaries (Samex S.A., Emibol S.A. and Bolivex S.A.) to be followed by disposition of the related subsidiaries (S.A.M.E.X. Corp. and Samex International), leaving us with Samex Chile as our sole remaining subsidiary. See Item 4.B. "Bolivian Properties".





Principal Expenditures And Divestitures





Since the beginning of the last three financial years, our principal capital expenditures or divestitures include the following:





During fiscal 2011, we entered into an option contract to acquire additional concessions adjacent to the Los Zorros Property. Under a Unilateral Option Contract dated June 28, 2011 between Cristian Marcelo Aravena Caullan and our subsidiary Minera Samex Chile S. A. (the "Aravena Option"), SAMEX had the option to acquire 100% interest in mineral concessions covering approximately 2,900 hectare adjacent to the Los Zorros property by paying the 2011/2012 patent payments (paid) and by making option payments totaling the Chilean Peso-equivalent of US$245,345 as follows: US$60,000 upon signing the Option (paid); U.S. $95,345 due January 31, 2012 (paid); and US$90,000 by January 31, 2013. However, subsequent to the year ended December 31, 2012, the Company decided not to exercise the Aravena option and advised the owner that it would not be making the final option payment of US$90,000 due January 31, 2013. Dropping the option on these concessions resulted in an impairment of the Aravena Option costs that had previously been capitalized to the Los Zorros Property and consequently option payments and patent costs totaling $201,407 were written off at December 31, 2012.





During fiscal 2011 we purchased 20 hectares of mineral concessions in the INCA project area held under a Unilateral Option Purchase Contract dated May 25, 2006 between Oscar David Rojas Garin and our subsidiary Minera Samex Chile S. A. (the "Rojas Option"). Under the Rojas Option, the Company had the right to acquire the concessions in consideration of the Chilean Peso-equivalent of US$300,000 (US$150,000 of which the Company had previously paid). During 2011, the Company paid the Chilean Peso-equivalent of US$150,000 to purchase a 100% interest in these mineral concessions.




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During 2009, we wrote down the value of all of our mineral properties in Bolivia to nominal consideration and placed the properties on “care and maintenance” status due to concerns over the prevailing legal and political climate in Bolivia. Subsequent to the year ended December 31, 2012, we decided to abandon our Bolivian properties and to commence closing the Bolivian subsidiaries. As a result of this decision, all of the Bolivian exploration and evaluation assets (total of $3,802) related to the Eskapa, El Desierto and Santa Isabel properties were written-off at December 31, 2012. See Item 4.B. "Bolivian Properties" and Item 4.A. "Wind-up Of Bolivian Subsidiaries".





We have not made any acquisitions of other companies and our shares are not subject to any public takeover offers. Neither we nor any of our subsidiaries have been involved in any bankruptcy, receivership or similar proceedings.





Our head office is located at #301 – 32920 Ventura Avenue, Abbotsford, British Columbia, V2S 6J3.The address for our registered and records office is #3000 Royal Center – 1055 West Georgia Street, Vancouver, British Columbia, V6E 3R3.The phone number of our head office is (604) 870-9920. In South America, we have a field office in Copiapo, Chile.





4.B. Business Overview.




Fiscal Year Ending December 31, 2012 (“FYE 2012”)





During FYE 2012 our exploration activities were focused principally on our Los Zorros Property and Chimberos Property in Chile. For the year ended December 31, 2012, expenditures related to our mineral exploration properties included "Exploration And Evaluation Assets" costs totaling $5,244,231and "Mineral Interests Administration And Investigation" expenses totaling $387,787.





Los Zorros Property - During 2012, exploration work at the Los Zorros Property included bulldozer work to construct access roads, drill pads and trenches and a total of 11,844 meters of drilling was completed in 21 core drill holes. We also further expanded the Los Zorros camp facilities to accommodate the additional geologists and support workers involved in the exploration and drilling activities.





Final Advance Royalty Payment Made – During the first quarter of 2012, we also made the final advance royalty payment of US$100,000 (in Chilean peso equivalent) in relation to a 209-hectare-portion of the Los Zorros property which the Company had acquired under the “Hochschild Option/Purchase”. Pursuant to the terms of the agreement, if the concessions were not in production by December 31, 2007, advance royalty payments of US$100,000 per year were required for five years: by February 29, 2008 (paid), by March 1, 2009 (paid), by March 1, 2010 (paid), by March 1, 2011 (paid), and by March 1, 2012 (paid) to a maximum of US$500,000 ($500,000 paid). The advance royalty payments are recoverable from future royalty payments.





Aravena Option (Dropped Subsequent To Year End) - During the three months ended March 31, 2012 we made an option payment of US$95,345 on the Aravena Option. Pursuant to an option contract dated June 28, 2011, the Company had an option to acquire a 100% interest in approximately 2,900 hectares of mineral concessions adjacent to the Los Zorros property by making option payments totaling the Chilean peso equivalent of U.S. $245,345 as follows: U.S. $60,000 on signing (paid); U.S. $95,345 due January 31, 2012 (paid) and U.S. $90,000 due January 31, 2013. However, subsequent to the year ended December 31, 2012 the Company decided not to exercise the Aravena option and advised the owner that it would not be making the final option payment of US$90,000 due January 31, 2013. This resulted in an impairment of the Aravena Option costs that had previously been capitalized to the Los Zorros Property and consequently option payment costs and patents costs totaling $201,407 were written off at December 31, 2013.




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Chimberos Property - During the fourth quarter of fiscal 2012, we completed blasting and bulldozer work to construct access roads and drill pads in preparation for drilling. By year-end, six core holes had been drilled for a total of 2,073 meters of drilling.





INCA Property - Expenditures on the INCA property during 2012 included costs for staking, surveying, constructing monuments for concessions, annual patent payments, maintaining and staffing the INCA camp/core storage facilities, and monthly payments related to the US$50,000 buy out of the 1% NSR on the Providencia Mine concessions (pursuant to a royalty purchase contract dated August 20, 2012 the Company is buying out the 1% NSR on the Providencia Mine concessions, which comprise a portion of the INCA Property, for the Chilean peso equivalent of US$50,000 by making 10 payments as follows: US$5,000 on August 31, 2012 (paid); US$5,000 on October 4, 2012 (paid); US$5,000 on November 4, 2012 (paid); US$5,000 on December 4, 2012 (paid); US$5,000 on January 4, 2013 (paid); US$5,000 on February 4, 2013 (paid); US$5,000 on March 4, 2013 (paid); US$5,000 on April 4, 2013 (paid); US$5,000 on May 4, 2013; and US$5,000 on June 4, 2013).





During the year ended December 31, 2012 we received proceeds of $5,000 from the exercise of a warrant for the purchase of 25,000 shares at $0.20 per share. During 2012, the Company held a portion of its liquid assets in gold and silver bullion in lieu of holding cash. At December 31, 2012, the Company held 6,230 grams of gold and 10,328 ounces of silver which had a fair value of $642,690. During the year ended December 31, 2012, the Company recognized a gain of $419,332 on the changes in fair value of its gold and silver bullion. Subsequent to the year ended December 31, 2012, the Company sold all of its remaining gold and silver bullion holdings for proceeds of $651,753.





Fiscal Year Ending December 31, 2011 (“FYE 2011”)





During FYE 2011, we focused our activities in Chile where we continued exploration principally on our Los Zorros Property. Our mineral interest and exploration costs for the fiscal year ended December 31, 2011 included "Exploration And Evaluation Assets" costs totaling $3,345,249 and "Mineral Interests Administration And Investigation" expenses totaling $287,369.





We continued a drilling program at the Los Zorros Property that had commenced during 2010. In late January 2011 we started a substantial geophysical survey (at a cost of US$280,000) over portions of the Los Zorros district. During the second quarter ended June 30, 2011, the information gained from the drilling, assaying and the geophysical survey was evaluated and complied in preparation for more drilling which commenced early in the third quarter. During the later part of 2011 the Company engaged a consulting geophysicist to assist in the interpretation and correlation of geophysical data and we expanded the exploration program at Los Zorros by adding a second drill rig, three more geologists, and additional support staff at the camp. Exploration at Los Zorros during 2011 included drilling 13 core drill holes for a total of 6,335 meters drilled. We also commenced expansion of the Los Zorros camp and support facilities to accommodate the additional geologists and support workers and adding additional core logging, sampling, and core-saw equipment to facilitate increased exploration and drilling activities.





During FYE 2011, we also further expanded the Los Zorros land holdings: we entered into a Unilateral Option Contract dated June 28, 2011 with Cristian Marcelo Aravena Caullan (the "Aravena Option") to acquire a 100% interest in approximately 2,900 hectares of additional mineral concessions adjacent to the Los Zorros property by paying the 2011 patent payments (paid) and by making option payments totaling the Chilean peso equivalent of U.S. $245,345 as follows: U.S. $60,000 on signing (paid); U.S. $95,345 due January 31, 2012 (paid subsequent to the year) and U.S. $90,000 due January 31, 2013.





We also expanded our land holdings at the INCA property by staking additional concessions and by purchasing an additional 20 hectares of mineral concessions: under a Unilateral Option Purchase Contract dated May 25, 2006 between Oscar David Rojas Garin and our subsidiary Minera Samex Chile S. A., the Company had an option to acquire concessions covering a 20-hectare portion of the Inca project for consideration of the Chilean Peso-equivalent of US$300,000 (US$150,000 of which the Company had previously paid). During the third quarter, the Company paid the Chilean Peso-equivalent of US$150,000 to purchase a 100% interest in these mineral concessions (the "Rojas Option/Purchase").





During FYE 2011, we raised proceeds of $4,675,500 from the exercise of warrants and proceeds of $60,000 from the exercise of stock options. During fiscal 2010 and 1011 the Company used a portion of its cash to purchase gold and silver bullion to hold in lieu of cash. At December 31, 2011, the Company held 87,362.448 grams (2,809 ounces) of gold and 50,018.674 ounces of silver which had a fair value of $5,807,372. The fair value of the Company's gold and silver bullion holdings is determined by the closing prices of gold and silver at the date of the period/year end and also the US dollar exchange rates on these dates. There was a gain of $433,233 on the gold and silver bullion holdings for fiscal 2011.




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Fiscal Year Ending December 31, 2010 (“FYE 2010”)





During FYE 2010 we focused our exploration activities principally on our Los Zorros property in Chile. Our exploration/mineral interests costs for FYE 2010 totaled $1,314,972.





Our exploration work during the first, second and third quarters of 2010 was conducted at four individual projects situated within our Los Zorros gold property holdings in Chile. The work included bulldozer trenching, sampling, assaying and construction of roads and drill pads at the Milagro, Nora, Cinchado and Milagro Pampa Projects in preparation for drilling programs to test these four projects for multiple precious metal deposits. By the end of the third quarter we commenced exploration core drilling which continued through the fourth quarter of 2010 and into the first quarter of 2011. During 2010 we also conducted meetings and property tours for mining companies interested in our Inca Property in Chile.





We raised a total of $10,162,060 during FYE 2010 from two private placements at a price of $0.30 per unit and at $0.50 per unit and from the exercise of warrants.





Plans and Projections, 2013 - The Company's exploration activities over the next year will continue to be focused on our copper, gold and silver projects in Chile. The Company will continue to consider a joint venture or sale of all or a portion of the INCA copper-gold-molybdenum property in Chile.





We raised a total of $10,162,060 during FYE 2010 from two private placements and the exercise of warrants; during FYE 2011 we raised proceeds of $4,735,500 from the exercise of warrants and stock options, and during the year ended December 31, 2012 we received proceeds of $5,000 from the exercise of 25,000 warrants.Based on current assets on hand at the date of this report, we believe we have sufficient funds to conduct our general operations over the next year, however we may require additional capital to fund our exploration programs over the next year. Beyond that time,it will be necessary to raise additional financing in order to fund our ongoing general operations and exploration programs.We propose to raise the required funds through the issuance of securities, by way of either private placement, exercise of warrants, by public offering and/or joint venture or sale of certain mineral properties in order to fund our exploration. Although we anticipate we will be able to complete equity placements sufficient to meet our capital requirements, there can be no assurance that we will be able to do so on terms favorable to us or at all. See Item 4 “Information on the Company” – “Description of Property”. See “Special Note Regarding Forward Looking Statements”.





Description of Property




WE ARE AN EXPLORATION STAGE COMPANY AND HAVE NO MINERAL PRODUCING PROPERTIES AT THIS TIME. ALL OF OUR PROPERTIES ARE EXPLORATION PROJECTS, AND WE RECEIVE NO REVENUES FROM PRODUCTION. ALL WORK PRESENTLY PLANNED BY US IS DIRECTED AT DEFINING MINERALIZATION AND INCREASING UNDERSTANDING OF THE CHARACTERISTICS AND ECONOMICS OF THAT MINERALIZATION. THERE IS NO ASSURANCE THAT A COMMERCIALLY VIABLE MINERAL DEPOSIT EXISTS IN ANY OF OUR PROPERTIES NOR DO WE ANTICIPATE SAME UNTIL AFTER COMPLETION OF FURTHER EXPLORATION WORK AND A COMPREHENSIVE EVALUATION BASED UPON UNIT COST, GRADE, RECOVERIES AND OTHER FACTORS CONCLUDE ECONOMIC FEASIBILITY.




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Los Zorros
 Property, Chile The Los Zorros Property in the Atacama region of northern Chile is located approximately 60 kilometers south of the city of Copiapo, Chile. The property is accessed by vehicle by driving approximately 60 kilometers south of the city of Copiapo on the paved, four-lane Pan American Highway (Highway 5) then traveling 5.5 kilometers east on a government maintained dirt road to the western boundary of the property and a further 4 kilometers to the Company’s exploration camp.





The Los Zorros property covers a district of about 80 square kilometers with numerous scattered small mines and prospects where there was sporadic attempts at small-scale production for copper, gold and silver in the past. The exploration objective at Los Zorros is to explore for copper, gold and silver beneath the widespread mineral occurrences in this district of historic small mining activity. The Los Zorros property is a very large, district-sized land holding, only a portion of which has been systematically explored by SAMEX to date. The Company has 100% interest in 67 mineral concessions (approx. 8,690 hectares) acquired by staking, purchase at government auction, purchase agreement, and by two purchase option contracts. Of particular significance, all acquisition payments have been made on these extensive accumulated land holdings at Los Zorros.




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The Los Zorros district is situated at the convergence of important geologic and structural features. The property covers the breadth of a regional anticlinorium with bedrock of calcareous sediments and diorite sills; the property is diagonally crossed by an 8-kilometer-long trend of barite veins which appears to comprise an extensive sigmoidal (S-shaped) fracture system. The property is also the locus of younger porphyry intrusions; clay-sericite-pyrite alteration is superposed on the porphyry intrusions. Much of these altered areas and parts of the barite vein swarm, are largely concealed beneath a thin veneer of gravel and wind-blown silt. The style of mineralization at Los Zorros varies from steep crosscutting veins and breccia to bedded mantos-like occurrences – hosted within sedimentary rocks outboard to the altered porphyritic intrusions. There is widespread occurrence of gold-bearing barite veins and altered fault zones; common, widespread occurrence of jasperoid silica; large areas/intersections of anomalous gold and the presence of important pathfinder metals (Hg, As, Sb) often found in association with gold mineralization. Metal-laden hydrothermal fluids thought to be derived from the younger porphyritic intrusions, likely expelled out along fault structure pathways and into favorable sedimentary intervals to form copper, gold and silver mineralized areas.





Many kilometers of access roads, bulldozer trenches, and a total of 29,434.45 meters of drilling in 65 core drill holes have been completed during various exploration programs conducted by SAMEX between 2004 and 2012. A detailed summary of work done on the property is contained in our Form 20-F Annual Report for the year ended December 31, 2011, a copy of which is filed with the SEC and in a Company news release dated September 25, 2012 filed with the SEC on Form 6-K. Copies of the Form 20-F and Form 6-K can be viewed at www.sec.gov/edgar.shtml. During 2012, exploration work at Los Zorros included bulldozer work to construct access roads, drill pads and trenches and a total of 11,844 meters of drilling was completed in 21 core drill holes. We also further expanded the Los Zorros camp facilities to accommodate the additional geologists and support workers involved in the exploration and drilling activities.





In addition to the exploration that has been conducted from 2004 to 2012, exploration drilling is ongoing at Los Zorros in 2013 with a focus on the "El Gringo" area. Work done to date has been successful in identifying a number of areas of mineralization and a number of targets for additional exploration, but has yet to confirm discovery of a mineral deposit with potentially economic size and grade. For a detailed description of the work subsequent to the year ended December 31, 2012, see Company news releases dated January 31, 2013, February 27, 2013 and March 27, 2013 filed with the SEC on Form 6-K, available for viewing at www.sec.gov/edgar.shtml.





Aravena Option Dropped - Costs Written Off at December 31, 2012 - Under a Unilateral Option Contract dated June 28, 2011 between Cristian Marcelo Aravena Caullan and our subsidiary Minera Samex Chile S. A. ("the Aravena Option"), the Company had an option to acquire 100% interest in additional mineral concessions covering approximately 2,900 hectare adjacent to the Los Zorros property by paying the 2011/2012 patents (paid) and by making option payments totaling the Chilean Peso-equivalent of US$245,345 as follows: US$60,000 upon signing the Option (paid); U.S. $95,345 due January 31, 2012 (paid); and US$90,000 by January 31, 2013. However, subsequent to the year ended December 31, 2012, the Company decided not to exercise the Aravena Option and advised the owner that it would not be making the final option payment of US$90,000 due January 31, 2013. This resulted in an impairment of the Aravena Option costs that had previously been capitalized to the Los Zorros Property and consequently option payment costs and patents costs totaling $201,407 were written off at December 31, 2012.





Los Zorros Property Mineral Interests - The Company’s Chilean subsidiary, Minera Samex Chile, S.A, has 100% interest in 67 exploitation mining concessions (approx. 8,690 hectares) acquired by staking, purchase at government auction, purchase agreement, and by two purchase option contracts. The Company holds a 100% interest in the acquired concessions subject to the terms described below in the Purchase and Sale Agreement with Compania Contractual Minera Ojos del Salado, the Purchase Option Contract with Comercial Sali Hochschild S.A., the Purchase Option Contract with Compania Minera San Estaban Primera S.A., and subject to the Finder’s Fee, Bonus and Royalty described below:




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Purchase and Sale Agreement dated January 29, 2003 between our subsidiary, Minera Samex Chile S.A. and Compania Contractual Minera Ojos del Salado - We entered into a purchase agreement dated January 29, 2003, with the vendor, Compania Contractual Minera Ojos del Salado, to acquire approximately 1,429 hectares of mineral concessions covering old goldmines and gold showings in the Los Zorros district for US$50,000 cash (which has been paid). Because of the vendor’s interest in copper, under the purchase agreement, the vendor retained a back-in right to earn an interest in the property in the event that we discover a copper deposit containing not less than two million tonnes of contained equivalent copper on or within a half kilometer of the property. The vendor can elect to exercise the back-in right to earn a 30% interest by reimbursing us three times the expenditures incurred, and up to 51% interest by expending 100% of all further costs necessary to complete a bankable feasibility study on the property. Thereafter, the parties would negotiate a joint venture to carry out development and mining of the property.





Purchase Option Contract dated November 6, 2003, between our subsidiary, Minera Samex Chile S.A. and Compañia Minera y Comercial Sali Hochschild S.A. – In October 2006 we completed the acquisition of mineral concessions covering a 209-hectare-portion of the Los Zorros property (covers portions of the Milagro and Lora areas of the Los Zorros property). Under the Option, SAMEX acquired the concessions by making option payments totaling US$230,000 as follows: US$30,000 upon signing of the Option Agreement (paid); US$50,000 by October 31, 2004 (paid); US$50,000 by October 31, 2005; (paid); US$100,000 by October 31, 2006 (paid). Pursuant to the exercise of the Hochschild option and the related Purchase Contract dated October 27, 2006, SAMEX holds 100% interest in the concessions subject to a Net Smelter Return Royalty of 2% on gold and silver, 1.5% on copper, and 1.5% on other payable minerals, if the US$ price per pound of the mineral is less than US$1 or 2% if the US$ price per pound of the mineral is US$1 or greater. SAMEX has an option to buyout the Royalty at any time for US$1,800,000. Pursuant to the option/purchase agreement, if the concessions were not in production by December 31, 2007, advance royalty payments of US$100,000 per year were required for five years (by February 29, 2008 (paid), by March 1, 2009 (paid), by March 1, 2010 (paid), by March 1, 2011 (paid), and by March 1, 2012 (paid) to a maximum of US$500,000 (paid). The advance royalty payments are recoverable from future royalty payments.





Purchase Option Contract dated June 29, 2005 between our subsidiary, Minera Samex Chile S.A. and Compañia Minera San Estaban Primera S.A. – In December 2006 we completed the acquisition of mineral concessions covering a 95-hectare-portion of the Los Zorros property by making option payments totaling US$200,000 over 18 months as follows: US$75,000 upon signing the Option Agreement (paid); US$25,000 by December 20, 2005 (paid); US$50,000 by March 20, 2006 (paid); and US$50,000 by December 20, 2006 (paid). SAMEX now holds 100% interest in the concessions subject to a Net Smelter Return Royalty of 1.5% on copper, gold, silver, and other payable minerals. SAMEX has an option to buyout the Royalty at any time for US$1,000,000.





Finder’s Fee, Bonus and Royalty - Pursuant to a Consulting Agreement dated September 25, 2002 between SAMEX and Geosupply Servicios de Geologia & Mineria & Sondajes de Diamantina, the concessions in the Los Zorros district are subject to the following finder’s fee, bonus and royalty:





a)
A finder’s fee of US$10,000 payable within 90 days of commencement of a drilling program on the concessions (which has been paid);


b)
A bonus of US$150,000 payable within one year from the date of Commencement of Commercial Production on the concessions; and


c)
Net Smelter Return royalty equal to 0.25% of Net Smelter Returns.





Annual Patent Payments On the Company's Landholdings - Patents must be paid annually to the Chilean government during the month of March in order to maintain the mining concessions. Patent fees are calculated based upon the value of the Chilean Monthly Tax Unit (“M.T.U.”) which varies from month to month. In the case of an exploitation concession the annual patent fee is calculated as one-tenth (1/10th) of the Monthly Tax Unit per hectare (for example, in March 2012 the M.T.U. was 39,412 x 1/10th = 3,941.2 Chilean Pesos per hectare which, at the Observed US$/Peso exchange rate of 485.71 at March 15, 2012 equated to approximately US$8.11 per hectare for exploitation concessions). In the case of an exploration concession the annual patent fee is calculated as one-fiftieth (1/50th) of the Monthly Tax Unit per hectare (for example, in March 2012 the M.T.U. was 39,412 x 1/50th = 788.24 Chilean Pesos per hectare which, at the Observed US$/Peso exchange of 485.71 rate at March 15, 2012 equated to approximately US$1.62 per hectare for exploration concessions).




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Sampling, analytical procedures, controls at Los Zorros - Geochemical analyses on samples were performed by ALS Minerals, an independent, internationally recognized and ISO certified laboratory complying with the international standards ISO 9001:2000 and ISO 17025:1999. In preparing drill core samples for analysis, the core is cut or split in half, with one half kept for reference and re-analysis if necessary, while the other half is bagged and sealed as a sample for analysis. To provide quality control, pre-packaged, sealed, certified standard (include low and medium grade copper-gold pulps) and blank pulps are included for analysis by inserted them as samples in random order at approximately 1 per every 30 samples. To ensure chain of custody, the bagged samples for analysis are picked up by an agent of ALS Minerals and transported directly to the ALS Minerals laboratory at Antofagasta or at Coquimbo, Chile.





Los Zorros Property Concession Names/Numbers:


BARBAS 1-7 #03201-3085-9; BARBAS 21-37 #03201-3086-7; BARBAS 41-58 #03201-3087-5; BARBAS 61-74 #03201-3088-3; BARBAS 81-100 #03201-3089-1; BARBAS 101-103 #03201-3090-5; CANDY 1 1-14 #03201-5547-9; COSTA PINTO 1-4 Y 6-12 #03201-7094-K; ELISA 1 AL 4 #03201-0183-2; FLOR MARIA 1-74 #03201-2550-2; GOLD MINING I 1 #03201-6533-4; GRINGO 1-29 #03201-3941-4; GRINGO 31-60 #03201-3942-2; KARINA LXVIII 3-11 #03201-5553-3; LA COLORINA 1-15 #03201-2233-3; LA SOCIALISTA 1-20 #03201-3022-0; LA SOCIALISTA II #03201-1012-2; LAS VIZCACHAS 1-9 #03201-2483-2; LEONOR 1-3 #03201-2489-1; MILAGRO 1-20 #03201-2416-6; NORA I #03201-0527-7; NORA II #03201-2166-3; NORA TERCERA #03201-2643-6; POLO 1 #03201-6687-K; POLO 2 #03201-6688-8; PLACER 22 1-20 #03201-6957-7; SAN PEDRO 1-5 #03201-1246-K; SANTA ROSA 1-20 #03201-2490-5; EL ZORRO VI 1 AL 30 #03201-7294-2; EL ZORRO VII 1 AL 30 #03201-7292-6; EL ZORRO VIII 1 AL 10 #03201-7295-0; EL ZORRO IX 1 AL 20 #03201-7293-4; EL ZORRO X 1 AL 30 #03201-7308-6; EL ZORRO XI 1 AL 30 #03201-7309-4; EL ZORRO XII 1 AL 26 #03201-7310-8; EL ZORRO XIII 1 AL 29 #03201-7311-6; EL ZORRO XIV 1 AL 19 #03201-7312-4; EL ZORRO XV 1 AL 15 #03201-7313-2; THE FOXES ONE 1 AL 40 #03201-7185-7; THE FOXES TWO 1 AL 40 #03201-7186-5; THE FOXES THREE 1 AL 30 #03201-7187-3; THE FOXES FOUR 1 AL 20 #03201-7188-1; PIERNAS LARGAS 1 AL 16 #03201-7482-1; FOXES 1 AL 8 #03201-8071-6; EL ZORRO 16 B 1 AL 17 #03201-7666-2; EL ZORRO 18 1 AL 20 #03201-7668-9; EL ZORRO 19 1 AL 30 #03201-7669-7; EL ZORRO 20 1 AL 30 #03201-7670-0; EL ZORRO 21 1 AL 20 #03201-7671-9; EL ZORRO 1 AL 2 #03201-7664-6; EL ZORRO V 1 AL 9 #03201-7483-K; EL ZORRO 22 1 AL 17 #03201-7606-9; EL ZORRO 23 1 AL 19 #03201-7607-7; POLO 2 #03201-7485-6; POLO 3 #03201-7486-4; POLO 5 #03201-7488-0; PLACER 20 1 AL 30 #03201-7005-2; PLACER 21 1 AL 30 #03201-7006-0; FOXES II 1-2 #03201-8849-0; EL ZORRO 17 1 AL 30 #03201-7667-0; LA CURIOSA 1 AL 51 #03201-9563-2; NORITA 1-36 #03201-9564-0; POLO 4 #217-2012; VIVIANA I #03201-E231-2; VIVIANA II #03201-E232-0; VIVIANA III #03201-E233-9; VIVIANA IV #03201-E230-4





The Los Zorros Property is without a known body of commercial ore and our activities to date have been exploratory in nature.





Chimberos Property, Chile


The Chimberos Property is a silver-gold-copper prospect located about 75 kilometers north of the city of Copiapo and situated in the historic Chimberos mining district which was one of Chile’s largest silver producing areas. The property is accessed by vehicle by driving north from Copiapo on a paved, two-lane highway (Highway C-17) to the property which is adjacent to the highway. Part of the property covers much of the core of a complex fissure fault zone which controlled the enriched silver mineralization that was mined in the Buena Esperanza mines at Chimberos. The exploration objective at Chimberos is to explore for copper, gold and silver beneath this historic mining district.





During the fourth quarter of 2012, we completed blasting and bulldozer work to construct access roads and drill pads in preparation for a drilling program at Chimberos. In November, the Company commenced drilling, and by year-end, 2,073 meters of drilling had been completed in six core drill holes. For further details, see Company news releases dated November 5, 2012 and February 27, 2013 filed with the SEC on Form 6-K, available for viewing at www.sec.gov/edgar.shtml. Due to the change in geologic personnel in January 2013, a portion of the core drilled by the prior geologic team had not yet been logged, sampled and assayed by the time of this Annual Report. A review of the drill core and partial assays received by us to date indicate preliminary evidence of a series of events relating to a hydrothermal system, near what could be productive porphyries and breccias. See Item 5.A. "Chimberos Property".





Chimberos Property Mineral Interests - The Company’s Chilean subsidiary, Minera Samex Chile, S.A, has 100% interest in 36 exploitation mining concessions (approx. 2,828 hectares) acquired by staking and purchasing concessions at government auction.




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Annual Patent Payments On the Company's Landholdings - Patent payments must be paid annually to the Chilean government during the month of March in order to maintain the mining concessions. Patent fees are calculated based upon the value of the Chilean Monthly Tax Unit (“M.T.U.”) which varies from month to month. In the case of an exploitation concession the annual patent fee is calculated as one-tenth (1/10th) of the Monthly Tax Unit per hectare (for example, in March 2012 the M.T.U. was 39,412 x 1/10th = 3,941.2 Chilean Pesos per hectare which, at the Observed US$/Peso exchange rate of 485.71 at March 15, 2012 equated to approximately US$8.11 per hectare for exploitation concessions). In the case of an exploration concession the annual patent fee is calculated as one-fiftieth (1/50th) of the Monthly Tax Unit per hectare (for example, in March 2012 the M.T.U. was 39,412 x 1/50th = 788.24 Chilean Pesos per hectare which, at the Observed US$/Peso exchange of 485.71 rate at March 15, 2012 equated to approximately US$1.62 per hectare for exploration concessions).





Sampling, analytical procedures, controls at Chimberos - Geochemical analyses on samples were performed by ALS Minerals, an independent, internationally recognized and ISO certified laboratory complying with the international standards ISO 9001:2000 and ISO 17025:1999. In preparing drill core samples for analysis, the core is cut or split in half, with one half kept for reference and re-analysis if necessary, while the other half is bagged and sealed as a sample for analysis. To provide quality control, pre-packaged, sealed, certified standard (include low and medium grade copper-gold pulps) and blank pulps are included for analysis by inserted them as samples in random order at approximately 1 per every 30 samples. To ensure chain of custody, the bagged samples for analysis are picked up by an agent of ALS Minerals and transported directly to the ALS Minerals laboratory at Antofagasta or at Coquimbo, Chile.





Chimberos Property Concession Names/Numbers:


LARRY B 1 AL 19 #03201-3577-6; BUENA ESPERANZA #03201-0128-K; COLORADA 1-4 #03201-0981-7; DOS AMIGOS 1 AL 5 #03201-2242-2; GLORIA 1-2 #03201-1341-5; HILDA 2 AL 6 #03201-1765-8; INDEPENDENCIA 1-2 #03201-1157-9; PEHUENCHE #03201-0065-8; RECOVECO 1 AL 10 #03201-1330-K; SALVADORA #03201-1838-7; ZIG-ZAG #03201-0195-6; TRES PUNTAS I 1 AL 38 #03201-7314-0; TRES PUNTAS II 1 AL 20 #03201-7315-9; TRES PUNTAS III 1 AL 20 #03201-7316-7; TRES PUNTAS IV 1 AL 20 #03201-7317-5; TRES PUNTAS V 1 AL 20 #03201-7318-3; TRES PUNTAS VI 1 AL 4 #03201-7319-1; TRES PUNTAS VII 1 AL 7 #03201-7320-5; TRES PUNTAS XI 1 AL 20 #03201-7321-3; TRES PUNTAS XII 1 AL 40 #03201-7322-1; TRES PUNTAS XIII 1 AL 30 #03201-7323-K; TRES PUNTAS XIV 1 AL 53 #03201-7324-8; PUNTITA 1, 1 AL 4 #03201-8590-4; PUNTITA 2, 1 #03201-8638-2; PUNTITA 7, 1 #03201-8643-9; PUNTITA 8, 1 #03201-8591-2; PUNTITA 9, 1 #03201-8592-0; PUNTITA 10, 1 AL 5 #03201-8593-9; LARRY A 1 AL 20 #03201-8644-7; PUNTITA 5, 1 #03201-8641-2; PUNTITA 6, 1 #03201-8642-0; PUNTITA 11, 1 #03201-8594-7; ROB 1 AL 27 #1-852-2012; ROB I 1 AL 9 #2236-2012; ROB II 1 AL 11 #2237-2012; ALTARE 2-378-2012





The Chimberos Property is without a known body of commercial ore and our activities to date have been exploratory in nature.





Inca Property, Chile


The INCA property in the Atacama region of Chile is located approximately 90 kilometers north of the city of Copiapo, Chile and 6.0 kilometers east of the paved highway that connects Copiapo to Diego Del Amargo and the El Salvador Mine. The property is accessed by vehicle by driving north from Copiapo on paved, two-lane highway (Highway C-17) to the village of Inca de Oro. The INCA property and the Company’s exploration camp are located about 6 kilometers east of the village of Inca de Oro along a government maintained gravel road leading to the San Pedro de Cachiyuyo district. The INCA property is favorably situated from a logistical perspective, being close to important transportation routes, power lines and general mining infrastructure.





Historically, the INCA project area has been the center of small mining activity primarily for production of oxide-copper and some secondary enriched copper sulfide ores. This area hosts variably sized breccia pipes with outcropping, or historically mined copper, molybdenum and gold mineralization and the exploration objective has been to explore this area for copper, gold, silver and molybdenum.




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During 2006 we completed the construction and equipping of a camp and exploration office at the INCA project and compiled extensive maps of the project area. We also conducted more than 30 line-kilometers of IP geophysical survey over six survey lines. In 2007 we conducted additional geophysical surveys and a program of bulldozer trenching, sampling and assaying was completed. Blasting and bulldozer work was conducted to prepare access roads and drill pads for a Phase I core drilling program. The core-drilling program completed 10,309 meters of drilling in 35 holes. From the results of the Phase I exploration, it became apparent that, although some of the results (particularly in the area around the Providencia mine) were very promising, the first phase of exploration did not discover the presence of a wide-spread, near-surface porphyry copper deposit that we had hoped for. We concluded that, although the possibility still existed to find a large scale copper deposit at INCA, considerable more exploration work and expenditures would be required to do so, which exceeded our available resources at that time. Since that time we have been seeking to arrange a joint venture or sale of all or a portion of our INCA copper, gold, molybdenum property.





Of importance, during 2009 we completed the final option payment under the “Araya Option” to acquire the Providencia Mine concessions situated within the greater INCA project area. These concessions cover one of the stronger mineralized areas identified during phase I exploration at the INCA project including the Providencia copper breccia pipe, a swarm of sheeted veins, and other tourmalinized/silicified breccia bodies and pipes.





During 2011 we expanded our land holdings at the INCA property by purchasing 20 hectares of mineral concessions pursuant to the "Rojas Option" for consideration of the Chilean Peso-equivalent of US$300,000 (paid). With the staking of additional concessions during 2011 and 2012, our landholdings at the INCA project consist of 61 concessions (approx. 8,994 hectares) including the 45-hectare Providencia Mine concessions that we acquired in 2009 pursuant to the “Araya Option” and the 20 hectares of concessions we purchased during 2011 pursuant the Rojas Option. With these acquisitions, SAMEX holds prospective and strategic concessions within the INCA project area. See news releases concerning the INCA Property on the SAMEX website at www.samex.com.





Expenditures on the INCA property during 2012 included costs for staking, surveying, constructing monuments for concessions, annual patent payments, maintaining and staffing the INCA camp/core storage facilities, and monthly payments related to the US$50,000 buy out of the 1% NSR on the Providencia Mine concessions which comprise a portion of the INCA property. We are continuing our efforts to arrange a joint venture or sale of all or a portion of our INCA copper, gold, molybdenum property.





INCA Property Mineral Interests - The Company’s Chilean subsidiary, Minera Samex Chile S.A. has 100% interest in 61 exploitation mining concessions (approx. 8,994 hectares) acquired by staking, purchase at government auction, and by the Araya Option, the Rojas Option/Purchase, and the Viscacha I Purchase as described below:





Araya Option – Pursuant to a Unilateral Option Purchase Contract dated April 4, 2006 with Malvina del Carmen Araya Santander the Company acquired 100% interest in 45 hectares of mineral interests (the Providencia Mine concessions situated within the greater INCA project area) for consideration of option payments totaling the Chilean Peso-equivalent of US$300,000 (paid). Buy-out of NSR Royalty - A 1% NSR royalty was retained by the vendor, however pursuant to a royalty purchase contract dated August 20, 2012 the Company is buying out the 1% NSR royalty on the Providencia Mine concessions (which comprise a portion of the INCA Property) for the Chilean peso equivalent of US$50,000 by making 10 payments as follows: US$5,000 on August 31, 2012 (paid); US$5,000 on October 4, 2012 (paid); US$5,000 on November 4, 2012 (paid); US$5,000 on December 4, 2012 (paid); US$5,000 on January 4, 2013 (paid); US$5,000 on February 4, 2013 (paid); US$5,000 on March 4, 2013 (paid); US$5,000 on April 4, 2013 (paid); US$5,000 on May 4, 2013; and US$5,000 on June 4, 2013.





Rojas Option/Purchase - The Company acquired 100% interest in 20 hectares of mineral concessions within the greater INCA project area for consideration of payments totaling U.S. $300,000 (paid). No royalty is payable on these concessions.




Vizcacha I Purchase – The Company purchased the Vizcacha I mineral concession covering a 3-hectare-portion of the INCA project for a total consideration of US$32,938 (17,000,000 Chilean Pesos). No royalty is payable on this concession.





Annual Patent Payments On the Company's Landholdings - Patent payments must be paid annually to the Chilean government during the month of March in order to maintain the mining concessions. Patent fees are calculated based upon the value of the Chilean Monthly Tax Unit (“M.T.U.”) which varies from month to month. In the case of an exploitation concession the annual patent fee is calculated as one-tenth (1/10th) of the Monthly Tax Unit per hectare (for example, in March 2012 the M.T.U. was 39,412 x 1/10th = 3,941.2 Chilean Pesos per hectare which, at the Observed US$/Peso exchange rate of 485.71 at March 15, 2012 equated to approximately US$8.11 per hectare for exploitation concessions). In the case of an exploration concession the annual patent fee is calculated as one-fiftieth (1/50th) of the Monthly Tax Unit per hectare (for example, in March 2012 the M.T.U. was 39,412 x 1/50th = 788.24 Chilean Pesos per hectare which, at the Observed US$/Peso exchange of 485.71 rate at March 15, 2012 equated to approximately US$1.62 per hectare for exploration concessions).




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Sampling, analytical procedures, controls at INCA - Geochemical analyses on samples were performed by ALS Minerals, an independent, internationally recognized and ISO certified laboratory complying with the international standards ISO 9001:2000 and ISO 17025:1999. In preparing drill core samples for analysis, the core is cut or split in half, with one half kept for reference and re-analysis if necessary, while the other half is bagged and sealed as a sample for analysis. To provide quality control, pre-packaged, sealed, certified standard (include low and medium grade copper-gold pulps) and blank pulps are included for analysis by inserted them as samples in random order at approximately 1 per every 30 samples. To ensure chain of custody, the bagged samples for analysis are picked up by an agent of ALS Minerals and transported directly to the ALS Minerals laboratory at Antofagasta or at Coquimbo, Chile.





INCA Property Concession Names/Numbers:


VIZCACHA 1 #03102-2300-K; VIZCACHA 1-2 #03102-2609-2; IRLANDA I 1 AL 3 #03102-3047-2; IRLANDA II 1 AL 2 #03102-3048-0; IRLANDA IV 1 AL 4 #03102-3050-2; IRLANDA V 1 #03102-3051-0; IRLANDA VI 1 #03102-3052-9; IRLANDA VII 1 #03102-3053-7; IRLANDA VIII 1 #03102-3054-5; IRLANDA X 1 AL 4 #03102-3055-3; IRLANDA XI 1 AL 16 #03102-3056-1; IRLANDA XII 1 AL 20 #03102-3057-K; LINDA II 1 #03102-3045-6; IRLANDA IX 1 AL 3 #03102-3112-6; LINDA III 1 AL 3 #03102-3046-4; LINDA I 1 AL 31 #03102-3044-8; MONTANA III 1 AL 30 #03102-3529-6; MONTANA VI 1 AL 30 #03102-3532-6; MONTANA VII 1 AL 30 #03102-3533-4; MONTANA IX 1 AL 30 #03102-3535-0; COLUMBIA VIII 1 AL 20 #03102-3578-4; MONTANA TRES 1 AL 27 #03102-3419-2; MONTANA CUATRO 1 AL 11 #03102-3420-6; MONTANA II 1 AL 30 #03102-3528-8; MONTANA 21 1 AL 30 #03102-3444-3; MONTANA VIII 1 AL 30 #03102-3534-2; MONTANA UNO 1 AL 30 #03102-3417-6; MONTANA DOS 1 AL 26 #03102-3418-4; MONTANA CINCO 1 AL 17 #03102-3392-7; MONTANA 15 1 AL 10 #03102-3439-7; MONTANA 16 1 AL 10 #03102-3440-0; MONTANA 18 1 AL 30 #03102-3442-7; MONTANA 19 1 AL 30 #03102-3551-2; MONTANA 1 AL 29 #03102-3417-4; MONTANA 5 C 1 AL 10 #03102-3392-2; PUNTILLA #03102-0675-K; MATILDE 3 – 4 #03102-0674-1; AURORA 1-5 #03102-0692-K; BLANCA O CONSUELO #03102-0525-7; CONCEPCION 1-6 #03102-0897-3; JUSTA 1 #03102-0581-8; PROVIDENCIA 1-9 #03102-1054-4; CHABELITA I #03102-D295-K; CHABELITA II #03102-D296-8; CHABELITA III #03102-D297-6; CHABELITA IV #03102-D298-4; CHABELITA V #03102-D299-2; CHABELITA VI #03102-D300-K; CHABELITA VII #03102-D301-8; CHABELITA VIII #03102-D302-6; CHABELITA IX #03102-D364-6; CHABELITA X #03102-D365-4; CHABELITA XI #03102-D303-4; CHABELITA XII #03102-D304-2; CHABELITA XIII #03102-D305-0; CHABELITA XIV #03102-D306-9; CHABELITA XV #03102-D307-7; CHABELITA XVI #03102-D308-5; CHABELITA XVII #03102-D309-3; CHABELITA XVIII #03102-D310-7; CHABELITA XIX #03102-D311-5





The INCA property is without a known body of commercial ore and our activities to date have been exploratory in nature.





Espejismo Prospects, Chile - Gold Prospects, Inca de Oro region, Chile. SAMEX acquired rights to 11 mineral concessions (approx. 517 hectares) covering gold prospects by purchasing concessions at a government auction and by staking. No exploration is planned for these gold prospects until additional concessions are acquired.





Miscellaneous Properties, Chile - The Company holds various miscellaneous mineral concessions (approx. 800 hectares) for possible future evaluation. No exploration is currently planned for these concessions.





Bolivian Properties, Bolivia (Eskapa, El Desierto, Santa Isabel Properties Written-Off)


In 2009, we decided to temporarily suspend exploration activities in Bolivia and put the Bolivian properties on “care and maintenance” status due to what we viewed as a deteriorating political climate for resource companies. This conclusion was re-enforced by a number of events such as the nationalization of Bolivia’s natural gas resources, a moratorium on the grant of new mineral exploration licenses, and a national referendum that resulted in constitutional changes and requirements that all mining projects be conducted only in partnership with the state mining company – on economically unfavorable terms. Since that time, due to the inactivity on the Bolivian properties, each subsequent year we have written down the property interest for the Eskapa, El Desierto and Santa Isabel properties to a nominal value of $1,000 each. Subsequent to the year ended December 31, 2012, we decided to abandon our Bolivian operations and let the Bolivian properties lapse by not paying the annual patents. As a result of this decision, all of the Bolivian exploration and evaluation assets (total of $3,802) related to the Eskapa, El Desierto and Santa Isabel properties were written-off at December 31, 2012.
 We are currently taking steps to dispose of any remaining assets in Bolivia and to wind-up and close the Bolivian subsidiaries and to dispose of our interest in our related subsidiaries. For further description of our Bolivian properties and exploration work completed on them, please refer to our Form 20-F Annual Report for the year ended December 31, 2011 previously filed with the SEC, a copy of which may be viewed at www.sec.gov/edgar.shtml. See Item 4.A."Wind-up Of Bolivian Subsidiaries.




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Seasonality




The Company's business is not subject to seasonal variations.





Competition




The mineral property exploration and development business, in general, is intensively competitive and there is not any assurance that even if commercial quantities of minerals are discovered, a ready market will exist for sale of same. Numerous factors beyond our control may affect the marketability of any substances discovered. These factors include market fluctuations; the proximity and capacity of natural resource markets and processing equipment; and government regulations, including regulations relating to prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection. The exact effect of these factors cannot be accurately predicted, but the combination of these factors may make it difficult for us to receive an adequate return on investment.




4.C. Organizational Structure.




See “History and Development of the Company” for subsidiaries and organizational chart.





4.D. Property, Plants and Equipment.




We do not own any of our offices. Our executive office is located at suite 301, 32920 Ventura Avenue, Abbotsford, British Columbia, Canada that we rent on a month-to-month basis at a monthly cost of approximately $2,250 including rent/taxes/operating costs. We have a field-office/residence in Copiapo, Chile that we rent on a month to month basis at a cost of approximately US$2,050 per month. See “Business Overview” for a description of our mineral exploration properties.





Item 4.A. Unresolved Staff Comments.





Not Applicable.





Item 5. Operating And Financial Review And Prospects




International Financial Reporting Standards - Our consolidated financial statements have been prepared in Canadian dollars and in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board,which differ in significant respects from Canadian GAAP and U.S. GAAP. As such, this discussion of our financial condition and results of operations is based on the results prepared in accordance with IFRS. See Item 3.A. Selected financial data - "Conversion To International Financial Reporting Standards (“IFRS”)".





Pursuant to IFRS, during the year ended December 31, 2012 management concluded that the functional currency of the Company's subsidiary, Minera Samex Chile S.A. is the Chilean Peso and not the Canadian dollar as it was previously designated to be, and accounted for this accordingly. In consideration of the effects of the difference in foreign exchange translation and to reflect the Chilean Peso being identified as the functional currency of Minera Samex Chile S.A., the consolidated statements of financial position as at December 31, 2011 and January 1, 2011 and the consolidated statements of comprehensive loss and cash flows for the year ended December 31, 2011 have been restated to reflect the Chilean peso as the functional currency of Minera Samex Chile S.A. See Item 18. Financial Statements - "Note 13 Restatement", for these adjustments made for fiscal 2011.




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The following discussion of our operating results explains material changes in our consolidated results of operations for the year ended December 31, 2012. These consolidated financial statements include the accounts of the Bolivian subsidiaries for a 12 month period that includes their second, third and fourth quarters from January 1, 2012 to September 30, 2012 and the first quarter of their 2013 fiscal year from October 1, 2012 to December 31, 2012. The discussion should be read in conjunction with the Company's consolidated financial statements to December 31, 2012 and the related notes included in this report. Management’s discussion and analysis of our operating results in this section is qualified in its entirety by, and should be read in conjunction with, the consolidated financial statements and notes thereto. This discussion contains forward-looking statements, the accuracy of which involves risks and uncertainties and our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including, but not limited to, those risk factors described elsewhere in this report. See “Special Note Regarding Forward Looking Statements” and Risk Factors”.





Overview




Our business is exploration for minerals. We do not have any properties that are in production. We have no earnings and, therefore, finance these exploration activities by the sale of our equity securities or through joint ventures with other mineral exploration companies. The key determinants of our operating results include the following:





a)
our ability to identify and acquire quality mineral exploration properties on favorable terms;


b)
the cost of our exploration activities;


c)
our ability to finance our exploration activities and general operations;


d)
our ability to identify and exploit commercial deposits of mineralization; and


e)
the write-down and abandonment of mineral properties as exploration results provide further information relating to the underlying value of such properties.





These determinates are affected by a number of factors, most of which are largely out of our control, including the following:





a)
the competitive demand for quality mineral exploration properties;


b)
political and regulatory climate in countries where properties of interest are located;


c)
regulatory and other costs associated with maintaining our operations as a public company;


d)
the costs associated with exploration activities; and


e)
the cost of acquiring and maintaining our mineral properties.





Our primary capital and liquidity requirements relate to our ability to secure funds, principally through the sale of our securities, to raise sufficient capital to maintain our operations and fund our efforts to acquire mineral properties with attractive exploration targets and conduct successful exploration programs on them. We anticipate this requirement will continue until such time as we have either discovered sufficient mineralization on one or more properties with sufficient grade, tonnage and type to support the commencement of sustained profitable mining operations and are thereafter able to place such property or properties into commercial production or until we have obtained sufficient positive exploration results on one or more of our properties to enable us to successfully negotiate a joint venture with a mining company with greater financial resources than us or some other suitable arrangement sufficient to fund our operations.





Our success in raising equity capital is dependent upon factors which are largely out of our control including:





a)
market prices for gold, silver, copper and other metals and minerals;


b)
the market for our securities; and


c)
the results from our exploration activities.




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Significant factors affecting our operations over the past several years include the instability in the global financial situation and the related volatility in the demand for, and in the prices of precious and base metals. During 2012, lingering effects of the 2008-2009 financial crisis and government responses to it - including high levels of government debt, adoption of expansionist monetary policies, Eurozone instability, and a growing sovereign debt crisis - contributed to a significant increase in the demand for, and in the price of, gold and silver, although with considerable volatility. While, in April 2013, gold and silver experienced a dramatic price drop over a two week period that resulted in a negative outlook for junior exploration companies. While uncertainty over global financial conditions had led to significant increases in the price of gold and silver and a brief improvement in the market for securities of precious metal exploration companies in 2011, it has also led to significant market uncertainty and more recently, a significant decline in the market for junior resource companies. While we anticipate that improved metal prices will in due course improve the market for the securities of junior gold and silver explorers and therefore our ability to secure additional equity financing, the timing and extent of such effects cannot be accurately predicted. Metal prices cannot be predicted with accuracy and our plans will be largely dependent upon the timing and outcome of metal markets, particularly the price of gold, silver and copper which is entirely outside of our control. We also anticipate that our operating results would be significantly affected by the results of our exploration activities on our existing properties. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.




Currency Risk




Currency exchange rate fluctuations could adversely affect our operations. The parent Company's functional currency is the Canadian Dollar and the functional currency of the Company's subsidiary, Minera Samex Chile S.A., is the Chilean Peso. We have obligations and commitments in Canadian Dollars, Chilean Pesos and United States Dollars. Fluctuations in foreign currency exchange rates may affect our results of operations and the value of our foreign assets, which in turn may adversely affect reported financial figures and the comparability of period-to-period results of operations.




Accounting Policies





We have adopted a number of accounting policies and made a number of assumptions and estimates in preparing our financial reporting, which are described in Note 2 to our consolidated financial statements. These policies, assumptions and estimates significantly affect how our historical financial performance is reported and also your ability to assess our future financial results. In addition, there are a number of factors which may indicate our historical financial results, but will not be predictive of anticipated future results. You should carefully review the following disclosure, together with the attached consolidated financial statements and the notes thereto, including in particular, the statement of significant accounting policies set out in Note 2 to such statements.





Going Concern Assumptions





As described in Note 1 to our consolidated financial statements, our consolidated financial statements have been prepared on the assumption that we will continue as a going concern, meaning that we will continue in operation for the foreseeable future and will be able to realize assets and discharge our liabilities in the ordinary course of operations. We do not have any mineral properties in production, and have not yet generated any revenues and have a history of losses. Our continuation as a going concern is uncertain and dependent on our ability to discover commercial mineral deposits on our properties and place them into profitable commercial production and our ability to sustain our operations until such time. This, in turn depends on our ability to continue to fund our operations by the sale of our securities and other factors which are largely out of our control. Although we have been successful in the past in obtaining financing, it cannot be assured that adequate financing or financing on acceptable terms can be obtained in the future. In the event we cannot obtain the necessary funds, it will be necessary to delay, curtail or cancel further exploration on our properties. Our consolidated financial statements do not reflect adjustments to the carrying values and classifications of assets and liabilities that might be necessary should we not be able to continue in our operations, and the amounts recorded for such items may be significantly different from those contained in our consolidated financial statements.




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Treatment of Mineral Property Costs





As we are at the exploration stage on our mineral properties, we capitalize the acquisition and exploration costs including the costs of acquiring licenses and costs associated with exploration and evaluation activity of our properties under IFRS. Costs incurred before the Company has obtained the legal rights to explore an area are recognized in profit or loss. Should any of these properties be placed into production, such costs would be amortized over the life of the properties on a unit-of-production basis. Should exploration results of any of our properties prove unsatisfactory, we would then abandon such property or properties, and write off costs incurred up to that time. The impact on our net loss for the fiscal period would be dependent upon the amount of costs deferred up to the time of the write-off. Exploration and evaluation assets are assessed for impairment if (i) sufficient data exists to determine technical feasibility and commercial viability, and (ii) facts and circumstances suggest that the carrying amount exceeds the recoverable amount. Once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are demonstrable, exploration and evaluation assets attributable to that area of interest are first tested for impairment and then reclassified to mining property and development assets within property and equipment.




Recoverability of the carrying amount of any exploration and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.





Accounting Estimates and Assumptions





The preparation of consolidated financial statements in conformity with IFRS requires management to make a wide variety of estimates and assumptions that affect (i) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as at the date of the consolidated financial statements, and (ii) the reported amounts of expenses during the reporting periods covered by the consolidated financial statements. Our management routinely makes judgments and estimates about the effect of matters that are inherently uncertain. As the number of variables and assumptions affecting the future resolution of the uncertainties increases, these judgments become even more subjective and complex. Estimates and assumptions are continuously evaluated and are based on management’s experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Areas requiring a significant degree of estimation and judgment relate to the determination of the useful lives of equipment, the carrying value of exploration and evaluation assets, fair value measurements for financial instruments and stock-based compensation and other equity-based payments, the recognition and valuation of provisions for restoration and environmental liabilities, and the recoverability and measurement of deferred tax assets and liabilities. Actual results may differ from those estimates and judgments. We have identified certain accounting policies that are most important to the portrayal of our current financial condition and results of operations. Our significant accounting policies are disclosed in Note 2 of notes to our consolidated financial statements, which should be read in conjunction with this Report.





Among other things, we determine our stock-based compensation costs using an option pricing model which involves the selection of highly subjective assumptions, including an assumption as to price volatility. Changes in these assumptions can materially affect the fair value estimate and therefore the current model does not provide a consistently reliable measure of the fair value cost of the Company’s outstanding stock options.





Stock-Based Compensation





We have a stock option plan whereby we grant incentive stock options as partial compensation to our directors, officers, employees and consultants. Share-based payments to employees are measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based payments to non-employees are measured at the fair value of goods or services received or the fair value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The corresponding amount is recorded to the share-based payment reserve. The fair value of options is determined using a Black–Scholes pricing model which incorporates all market vesting conditions. The number of shares and options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest. See Item 6.B “Compensation – Incentive Stock Options”.




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5.A. Operating Results




Overview Of Results For The Fiscal Year Ended December 31, 2012 (“FYE 2012”) With A Comparison To The Fiscal Year Ended December 31, 2011





The following section contains a summary of our operating results for the year ended December 31, 2012, which is qualified by detailed descriptions that follow elsewhere in this document. This section also contains a number of ‘forward looking statements’ which, although intended to be accurate, may be affected by a number of risks and uncertainties that may cause them to be materially different from actual outcomes. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.





As a junior exploration company, our operations are significantly affected by a number of external factors, particularly economic trends that affect the price of the commodities we explore for or those that affect the market for our securities. See Item 5.D “Trend Information”.





The Company raised substantial private placement funding during the later part of 2010 and received proceeds from the exercise of warrants during 2011 and 2012. This provided funding for our general operations and for exploration activities and expenditures during 2012 which included "Exploration And Evaluation Assets" costs totaling $5,244,231and "Mineral Interests Administration And Investigation" expenses totaling $387,787 for the year ended December 31, 2012.





Los Zorros Property, Chile - During 2012, exploration work at Los Zorros included bulldozer work to construct access roads, drill pads and trenches and a total of 11,844 meters of drilling was completed in 21 core drill holes. We also further expanded the Los Zorros camp facilities to accommodate the additional geologists and support workers involved in the exploration and drilling activities. The Los Zorros property covers a district of about 80 square kilometers with numerous scattered small mines and prospects where there was sporadic attempts at small-scale production for copper, gold and silver in the past. The exploration objective at Los Zorros is to explore for copper, gold and silver beneath the widespread mineral occurrences in this district of historic small mining activity. Of particular significance, all acquisition payments have now been made on our extensive accumulated land holdings at Los Zorros.See Item 4.B. "Los Zorros Property".





Final Advance Royalty Payment Made – During the first quarter of 2012, we made the final advance royalty payment of US$100,000 (in Chilean peso equivalent) in relation to a 209-hectare-portion of the Los Zorros property which the Company had acquired under the “Hochschild Option/Purchase”. Pursuant to the terms of the agreement, if the concessions were not in production by December 31, 2007, advance royalty payments of US$100,000 per year were required for five years: by February 29, 2008 (paid), by March 1, 2009 (paid), by March 1, 2010 (paid), by March 1, 2011 (paid), and by March 1, 2012 (paid) to a maximum of US$500,000 ($500,000 paid). The advance royalty payments are recoverable from future royalty payments.





Aravena Option Dropped Subsequent To Year End - During the first quarter of 2012 we made an option payment of US$95,345 on the Aravena Option. Pursuant to an option contract dated June 28, 2011, the Company had an option to acquire a 100% interest in approximately 2,900 hectares of mineral concessions adjacent to the Los Zorros property by making option payments totaling the Chilean peso equivalent of U.S. $245,345 as follows: U.S. $60,000 on signing (paid); U.S. $95,345 due January 31, 2012 (paid) and U.S. $90,000 due January 31, 2013. However, subsequent to the year ended December 31, 2012, the Company decided not to exercise the Aravena option and advised the owner that it would not be making the final option payment of US$90,000 due January 31, 2013. Dropping the option on these concessions resulted in an impairment of the Aravena Option costs that had previously been capitalized to the Los Zorros Property and consequently option payments and patent costs totaling $201,407 were written off at December 31, 2012.





In addition to the exploration that has been conducted at Los Zorros from 2004 to 2012, exploration drilling is currently ongoing in 2013. For further property details, see "Los Zorros Property" in Item 4.B "Description Of Property".





Chimberos Property, Chile - In November 2012 the Company commenced drilling at the Chimberos Property to explore in the area of the historic Buena Esperanza silver mine. During 2012, six core holes were drilled for a total of 2,073 meters. SAMEX is also in the process of updating exploration plans at the Chimberos Property to follow up its prior geological team’s recent drilling campaign. A detailed review of the drill core and partial assays received by us to date indicate preliminary evidence of a series of events relating to a hydrothermal system, near what could be productive porphyries and breccias. We anticipate announcing results in due course once all logging and assaying has been completed. For further property details, see "Chimberos Property" in Item 4.B. "Description Of Property".See “Special Note Regarding Forward Looking Statements”.




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INCA Property, Chile - During 2012 we continued to have discussions with parties interested in our INCA copper-gold- molybdenum property in Chile in an effort to arrange a joint venture or sale of all or a portion of the INCA property. With additional concessions staked, our landholdings at the INCA property consist of 61 concessions (approximately 8,994 hectares) of prospective and strategic concessions including the 45-hectare Providencia Mine concessions that we acquired in 2009 pursuant to the “Araya Option” and the 20 hectares of concessions we purchased during 2011 pursuant the Rojas Option/Purchase. Expenditures on the INCA property during 2012 included costs for staking, surveying, constructing monuments for concessions, annual patent payments, maintaining and staffing the INCA camp/core storage facilities, and monthly payments related to the US$50,000 buy out of the 1% NSR on the Providencia Mine concessions which comprise a portion of the INCA property. For further property details, see "INCA Property" in in Item 4.B "Description Of Property".





Bolivian Properties Written Off (Eskapa, El Desierto, Santa Isabel Properties) - Subsequent to the year ended December 31, 2012 we decided to abandon our Bolivian operations and allow the Bolivian properties lapse by not paying the property patents. As a result of this decision, all of the Bolivian exploration and evaluation assets (total of $3,802) related to the Eskapa, El Desierto and Santa Isabel properties were written-off at December 31, 2012. See Item 4.B. "Bolivian Properties" and Item 4.A. "Wind-up Of Bolivian Subsidiaries".





Gold and Silver Bullion Holdings - During 2012, the Company held a portion of its liquid assets in gold and silver bullion in lieu of holding cash. The Company sold 81,040 grams of gold bullion and 39,300 ounces of silver bullion during fiscal 2012. At December 31, 2012, the Company held 6,230 grams of gold and 10,328 ounces of silver which had a fair value of $642,690. Gold and silver bullion are measured at fair value with changes in carrying value being included in profit or loss. During the year ended December 31, 2012, the Company recognized a gain of $419,332 on the changes in fair value of its gold and silver bullion (2011 - a gain of $433,233). The $1,866,307 loss from operations for fiscal 2012 was offset by a gain of $419,332 on the changes in fair value of the gold and silver bullion holdings, resulting in a net and comprehensive loss of $761,555 for the year ended December 31, 2012. Subsequent to the year ended December 31, 2012, the Company sold all of its remaining gold and silver bullion holdings for proceeds of $651,753. We do not currently hold any gold or silver bullion.





Extension Of Warrant Terms - During 2012, the Company extended the terms of the following warrants:





1,823,668 warrants exercisable at $0.35 per share. These warrants were originally issued with a two-year term expiring July 8, 2012. The Company received consent from the TSX Venture Exchange to extend the term of these warrants for two additional years until July 8, 2014. The exercise price of the warrants remains at $0.35 per share. The extension of the term resulted in an incremental increase in the fair value of the warrants of $222,101 which was charged to deficit. Sasan Sadeghpour, a Director/Control Person of SAMEX, holds 861,834 of these warrants.





17,583,720 warrants exercisable at $0.70 per share. These warrants were originally issued with a two-year term expiring on November 1, 2012. The Company received consent from the TSX Venture Exchange to extend the term of these warrants for two additional years. The exercise price of the warrants remains at $0.70 per share. The extension of the term resulted in an incremental increase in the fair value of the warrants of $1,001,576 which was charged to deficit. Sasan Sadeghpour, a Director/Control Person of SAMEX, holds 10,164,000 of these warrants.





Settlement Agreement - During the third quarter of 2012, the Company postponed its annual general meeting originally scheduled for September 7, 2012, to help facilitate the completion of an amicable settlement agreement between all parties in regards to earlier disputes. On September 10, 2012, SAMEX reached an agreement (the "Settlement Agreement") with its largest shareholders, Sasco Partners, LP and Sasan Sadeghpour who collectively owned approximately 23.64% of SAMEX's outstanding common shares at that time. As part of the agreement, SAMEX appointed Sasan Sadeghpour to the SAMEX board of directors and to the position of Chair of the Board and also to serve on the Audit Committee and the Compensation Committee. In conjunction with the foregoing, Peter Dahl, agreed to step down as a director and Chair of the Board.A copy of the Settlement Agreement has been furnished on Form 6-K with the SEC on September
 13, 2012 and can be viewed at www.sec.gov/edgar.shtml. Pursuant to the Settlement Agreement, $50,000 was paid to Sasco Partners, LP, controlled by Sasan Sadeghpour, to reimburse for legal fees.




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Annual General Meeting - SAMEX held its annual general meeting in Abbotsford, BC on October 1, 2012. The shareholders passed an ordinary resolution at the meeting to determine the number of directors of the Company at six (6) and the following were elected as directors of the Company: Jeffrey Dahl - President & CEO; Sasan Sadeghpour - Chairman of the Board; Larry McLean - Vice President Operations and CFO; Robert Kell - Vice President Exploration; Allen Leschert; and Malcolm Fraser.





New Management Team - Subsequent to the year ended December 31,2012, the Company completed a change in seniormanagement pursuant to the terms of the Settlement Agreement effective January 15, 2013 as follows:





RESIGNING DIRECTORS AND OFFICERSName

OfficeJeffrey P. Dahl

Director, President and Chief Executive OfficerLarry D. McLean

Director, Vice President Operations, Chief Financial OfficerRobert E. Kell

Director, Vice President ExplorationAllen D. Leschert

DirectorMalcolm B. Fraser

DirectorBrenda McLean

Corporate SecretaryNEW AND CONTINUING APPOINTMENTSName

Office*Sasan Sadeghpour

Director, Chairman, Interim Chief Executive Officer*James Pappas

Director*Travis Cocke

Director*Patrick M. Cahill, CPA

DirectorLarry D. McLean

Interim Chief Financial OfficerBrenda McLean

Interim Corporate Secretary* Members of Audit Committee





All of the resigning directors and officers entered into 2 year advisory/consulting agreements (the "Advisory Agreements") with the Company whereby they agreed to continue to act as consultants to the Company in order to ensure an efficient and orderly transition to new management. The Advisory Agreements provided that the individuals would provide up to one (1) hour consultation per month in consideration for continuation of certain previously granted incentive stock options, with additional time, if required, to be based on a reasonable fee on terms and conditions to be agreed to. See 6.B. "Compensation - Stock Options" and Item 7.B. "Related Party Transactions". Sasan Sadeghpour, Director and Chairman of the Company, agreed to act as Interim Chief Executive Officer of the Company at an annual salary of $1.00. Larry D. McLean and Brenda McLean agreed to continue in a consulting role as Interim Chief Financial Officer and Interim Corporate Secretary, respectively, up to April 30, 2013 or until their permanent replacements are appointed.





As result of the forgoing change, the following three new directors were added to the Board:





James Pappas - James Pappas is the Managing Member of JCP Investment Management, LLC and the sole member of JCP Investment Holdings, LLC, the investment manager and general partner, respectively, of certain entities whose principal business is investing in securities. From 2005 until 2007, Mr. Pappas worked for The Goldman Sachs Group, Inc. (Ticker: GS) (“Goldman Sachs”), a multinational investment banking and securities firm, in their Investment Banking Division. Prior to Goldman Sachs, Mr. Pappas worked at Banc of America Securities, the investment banking arm of Bank of America, a multinational banking and financial services corporation. Mr. Pappas sits on the Board of Directors of Morgan’s Foods. Mr. Pappas received a Bachelor of Business Administration, and a Masters in Finance from Texas A&M University.




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Travis Cocke - Mr. Cocke has over seven years of public market investment experience including over two years as a portfolio manager with complete investment discretion for the public equity portfolio of a small family office. Prior to co-founding Southpaw Capital LLC in 2011, he was a Portfolio Manager at Farney Management Corp., and an Investment Analyst at Ascendant Advisors LLC. Mr. Cocke also held positions at the Texas Teachers Retirement System, a $100 billion public pension fund, and at Omega Advisors, a $6+ billion long/short hedge fund based in New York. Additionally, Mr. Cocke is a managing member for several private investment partnerships with interest in real estate and public equities. Mr. Cocke received a BBA in Finance from Texas A&M University.





Patrick M. Cahill, CPA - Mr. Cahill works as an independent consultant assisting companies on financial and operational projects. From 2001 to 2008, Mr. Cahill was the Chief Financial Officer of Champion Window, Inc. Champion is a manufacturer and distributor of windows to the new residential construction industry. From 1987 to 2001, he was employed at Equus Capital Management Corporation originally as its Controller and ultimately as a Vice President and its Chief Financial Officer. Equus was involved in the management of publicly traded and privately held leveraged buyout funds involved in the acquisition of small to medium sized businesses in a variety of industries. From 1982 to 1987 Mr.Cahill worked as an auditor for Ernst & Young. He has served on the board of directors of two privately held companies. Mr. Cahill is a graduate for The McCombs School of Business at The University of Texas.





As a result of terminations effected on January 15, 2013 pursuant to the Settlement Agreement, severance totaling $1,341,734 was paid to employees and a consultant of the Company, $1,188,000 of which was paid to employees and a consultant who were also former directors or officers of the Company.





Agreement with Toro Taylor - Our subsidiary Minera Samex Chile S.A. (“Samex Chile”) entered into an agreement dated January 16, 2013 with Toro Taylor Y Compañia Limitada (“ETT”), a company owned or controlled by our Chief Geologist, Juan Carlos Toro Taylor. Under the terms of the Agreement, ETT agreed to conduct certain exploration activities on the Company’s Chilean projects including in particular at least 1,200 meters of drilling. Samex Chile is required to pay compensation of US$40,000 per month to cover the cost of ETT consultants (including the sum of US$14,000 per month payable as compensation for Juan Carlos Toro Taylor) plus expenses and an administrative fee of 10% of exploration and travel expenses, excluding ETT consultant compensation. The term of the agreement is for three (3) months expiring April 17, 2013. The parties have agreed to extend the agreement for a further two months to allow for completion of the current work program.





Trends and Financing - Over the past several years, we have experienced a number of important external changes in the market place that had an effect on our overall performance. In the latter part of 2008, we found ourselves in the middle of a global economic crisis, with its actual or threatened bank failures, major international liquidity issues, and a general slowdown leading to a global recession. Shortly thereafter, commodity prices, particularly the price of copper, began a serious decline, eventually falling to a five year low, along with the price of gold and silver. Along with this, the share prices of most public companies including in particular junior resource stocks such as ours, fell to new lows, which greatly reduced our ability to raise capital. Although precious metal prices rebounded to trade at new highs, with considerable volatility, the market for the shares of junior explorers, after a brief improvement early in 2011, has significantly declined, making our ability to access capital to fund mineral exploration projects considerably more difficult. Also, although the global economy has now largely recovered from the primary effects of the global financial crisis, many countries - particularly the US and Euro-zone countries - are still experiencing slow growth, high unemployment and other economic stresses, which in turn may continue to depress general investor sentiment and their levels of risk tolerance, and thus the market for junior explorers. We anticipate that, due to prevailing global economic imbalances and other continuing economic conditions, gold and silver prices will be volatile and could rapidly reach much higher levels in response to economic shocks or other triggering events, should they occur. While such events could indirectly result in higher share prices for junior gold and silver explorers, we cannot accurately predict the timing of such events or their actual effect on our ability to raise capital.





Plans and Projections – SAMEX exploration activities will continue to be focused on its copper-gold-silver projects in Chile. The Company will continue to consider a joint venture or sale of all or a portion of the INCA copper-gold-moly property in Chile. See “Liquidity and Capital Resources” and “Anticipated Capital Requirements”. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.




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Summary for fiscal 2012





For the year ended December 31, 2012, expenditures related to our mineral exploration properties included "Exploration And Evaluation Assets" costs totaling $5,244,231and "Mineral Interests Administration And Investigation" expenses totaling $387,787. Our assets categorized in the Consolidated Statements Of Financial Position as “Exploration And Evaluation Assets" increased to $18,139,082 at December 31, 2012 ($12,397,911 at December 31, 2011).





Current Assets at December 31, 2012 totaled $3,531,045 ($9,918,174 at December 31, 2011). The Company's Total Assets were $21,772,354 at December 31, 2012 ($22,397,380 at December 31, 2011). At December 31, 2012, we were debt-free, apart from accounts payable and accrued liabilities of $193,848, the major portion of which was subsequently paid in January 2013.





The following comments relate to categories in the consolidated financial statements for the year ended December 31, 2012:





Statements of Financial Position


“Gold and Silver Bullion” - During 2012, the Company held a portion of its liquid assets in gold and silver bullion in lieu of holding cash. The Company sold 81,040 grams of gold bullion and 39,300 ounces of silver bullion for proceeds of $5,568,083 during the year ended December 31, 2012. At December 31, 2012, the Company held 6,230 grams of gold and 10,328 ounces of silver which had fair value of $642,690. Gold and silver bullion are measured at fair value with changes in carrying value being included in profit or loss. During the year ended December 31, 2012, the Company recognized a gain of $419,332 on the changes in fair value of its the gold and silver bullion (2011 - a gain of $433,233).





Consolidated Statements of Comprehensive Loss


"Interest and Bank Charges" - includes vault fees for storage of the Company's gold and silver bullion holdings.





“Mineral Interests Administration and Investigation Costs” - are expensed as incurred and are not capitalized to exploration and evaluation assets and include operating costs related to the Company’s activities in Chile and Bolivia that are not allocated to one of the Company’s specific mineral properties, and generative exploration or investigating and evaluating mineral properties not acquired by the Company.





“Office and Miscellaneous” - includes rent and utilities for the Canadian corporate office, book-keeping/accounting, office supplies, telephone, postage, courier, parking, mileage, printing, software.





“Professional Fees” – includes fees for consultants, legal fees for corporate counsel in Canada and South America as well as fees and retainers charged by specialized legal counsel and for other professional advisors/services.





"Salaries and Benefits" - the amount for the year ended December 31, 2011 included salary payments and one-time bonus payments made during the second quarter of fiscal 2011.





"Gain On Gold And Silver Bullion" - the Company recognized a gain of $419,332 on the sale of, or changes in fair value of the gold and silver bullion holdings during the year ended December 31, 2012.





"Net Loss" -The $1,866,307 loss from operations for fiscal 2012 was offset by a gain of $419,332 on the sale of, or changes in fair value of the gold and silver bullion holdings, resulting in a net loss of $1,446,975.





Statement of Changes In Shareholders' Equity


"Warrant Extension" - In fiscal 2011 the Company extended the term of 2,871,250 warrants at $1.00 per share by one additional year. This resulted in an incremental increase in the fair value of the warrants of $455,868 that was charged to deficit for fiscal 2011. During fiscal 2012 the Company received approval to extend the term of 1,823,668 warrants at $0.35 per share for two additional years, and to extend the term of 17,583,720 warrants at $0.70 per share for two additional years. This resulted in incremental increases in the fair value of the warrants of $222,101 and $1,001,576 respectively for a total charge of $1,223,677 to deficit for the year ended December 31, 2012.




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"Share Based Payments" - During the year ended December 31, 2012, the Company granted a stock option to an employee/geologist on a total of 100,000 shares at $0.50 per share with a fair value on the grant date of $26,891 which was capitalized to the Los Zorros Property exploration and evaluation costs as stock-based compensation.




Overview Of Results For The Fiscal Year Ended December 31, 2011 (“FYE 2011”) With A Comparison To The Fiscal Year Ended December 31, 2010 - The following section contains a summary of our operating results for the fiscal year ended December 31, 2011, which is qualified by detailed descriptions that follow elsewhere in this document. This section also contains a number of ‘forward looking statements’ which, although intended to be accurate, may be affected by a number of risks and uncertainties that may cause them to be materially different from actual outcomes. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.





As a junior exploration company, our operations are significantly affected by a number of external factors, particularly economic trends that affect the price of the commodities we explore for or those that affect the market for our securities. See Item 5.D “Trend Information”.





The Company raised substantial private placement funding during the later part of 2010 and received significant proceeds from the exercise of warrants during 2011, which allowed us to increase our staff and expand our exploration activities and expenditures during 2011 as compared to 2010. Costs for categories such as exploration and evaluation assets, mineral interests administration and investigation, office and miscellaneous, salaries and benefits, and travel and promotion correspondingly increased over the expenditures during 2010. For the year ended December 31, 2011, "Exploration And Evaluation Assets" costs totaled $2,570,758 (2010 - $1,309,685) and "Mineral Interests Administration And Investigation" expenses totaled $287,369 (2010 - $208,939).





Los Zorros Property, Chile -During the first quarter of 2011, we continued the drilling program at Los Zorros that had commenced during 2010. In late January 2011 we started a substantial geophysical survey (at a cost of US$280,000) over portions of the Los Zorros district. During the second quarter ended June 30, 2011, the information gained from the drilling, assaying and the geophysical survey was evaluated and complied in preparation for more drilling which commenced early in the third quarter of 2011. During the later part of 2011 we engaged a consulting geophysicist to assist in the interpretation and correlation of geophysical data and we expanded the exploration program at Los Zorros by adding a second drill rig, three more geologists, and additional support staff at the camp. We also commenced expansion of the Los Zorros camp and support facilities to accommodate the additional geologists and support workers and adding additional core logging, sampling, and core-saw equipment to facilitate increased exploration and drilling activities.





Exploration at Los Zorros during 2011 included drilling 13 core drill holes for a total of 6,335 meters drilled. See Item 4. Information On the Company - Description of Property - "Los Zorros Property" for details concerning exploration results and activities on the Los Zorros Property. Exploration and Evaluation Assets costs related to the Los Zorros Property totaled $3,010,043 (including $774,491 of stock-based compensation capitalized to the Los Zorros Property) for the year ended December 31, 2011. The major private placement funding we secured in the fourth quarter of 2010 along with proceeds of more than $4.6 million from exercise of warrants during 2011 has provided us with the financial resources to explore numerous project areas and prospective targets within the Los Zorros property holdings.





INCA Property, Chile - During 2011, we expanded our land holdings at the INCA property by exercising our option (the "Rojas Option") to purchase 20 hectares of mineral concessions by paying the balance of the Chilean Peso-equivalent of US$300,000 option price (US$150,000 of which the Company had previously paid) and staking addition concessions, increasing our landholdings to approximately 8,866 hectares, including the 45-hectare Providencia Mine concessions that we acquired in 2009 pursuant to the “Araya Option” and the 20 hectares of concessions we purchased during 2011 pursuant the Rojas Option.





We also continued our efforts to arrange a joint venture or sale of all or a portion of our INCA copper, gold, molybdenum property.




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Gold and Silver Bullion Holdings - During the first quarter of fiscal 2011, we used a portion of our cash to purchase an additional $200,000 worth of silver bullion and $799,969 worth of gold bullion to hold in lieu of cash. During the second quarter ended June 30, 2011, we used a portion of our cash to purchase approximately $999,980 worth of gold bullion to hold in lieu of cash. During the fourth quarter ended December 31, 2011, we sold 35,000 ounces of silver bullion for proceeds of $1,220,291 which resulted in a gain of $229,706 and purchased $509,140 worth of silver ounces. At December 31, 2011, we held 87,362.448 grams of gold and 50,018.674 ounces of silver which had a fair value of $5,807,372. The fair value of our gold and silver bullion holdings is determined by the closing prices of gold and silver at the date of the period/year end and also the US dollar exchange rates on these dates. Gold and silver bullion is measured at fair value through the statement of comprehensive loss. There was a gain of $433,233 on the gold and silver bullion holdings for fiscal 2011.





Bolivia:During 2011 our Bolivian properties remained on “care and maintenance” status. Due to the inactivity on the Bolivian properties, the property interest for the Eskapa Property, the El Desierto Property and the Santa Isabel Property was each written down to a nominal value of $1,000 resulting in a combined valuation of only $3,000 for our Bolivian properties at December 31, 2011. Subsequent to the end of the December 31, 2012year, we abandoned our Bolivian operations and are in the process of winding up our Bolivian Subsidiaries. See Item 4.B. "Bolivian Properties" and Item 4.A. "Wind-up Of Bolivian Subsidiaries".





Summary for Fiscal 2011 - During the first quarter of 2011, the Company continued a drilling program at Los Zorros that had commenced during 2010. In late January 2011 we started a substantial geophysical survey (at a cost of US$280,000) over portions of the Los Zorros district. During the second quarter ended June 30, 2011, the information gained from the drilling, assaying and the geophysical survey was evaluated and complied in preparation for more drilling which commenced early in the third quarter. During the later part of 2011 the Company engaged a consulting geophysicist to assist in the interpretation and correlation of geophysical data and we expanded the exploration program at Los Zorros by adding a second drill rig, three more geologists, and additional support staff at the camp. Exploration at Los Zorros during 2011 included drilling 13 core drill holes for a total of 6,335 meters drilled. We also commenced expansion of the Los Zorros camp and support facilities to accommodate the additional geologists and support workers and adding additional core logging, sampling, and core-saw equipment to facilitate increased exploration and drilling activities.





During 2011 we also further expanded the Los Zorros land holdings: we entered into a Unilateral Option Contract dated June 28, 2011 with Cristian Marcelo Aravena Caullan (the “Aravena Option”) to acquire a 100% interest in approximately 2,900 hectares of additional mineral concessions adjacent to the Los Zorros property by paying the 2011/2012 patent payments (paid) and by making option payments totaling the Chilean peso equivalent of U.S. $245,345 as follows: U.S. $60,000 on signing (paid); U.S. $95,345 due January 31, 2012 (paid subsequent to the year) and U.S. $90,000 due January 31, 2013.





During the first quarter, the Company made an advance royalty payment of US$100,000 (in Chilean peso equivalent) in relation to a 209-hectare-portion of the Los Zorros property which the Company purchased pursuant to the “Hochschild Option”.





During 2011 we expanded our land holdings at the INCA property by exercising the Rojas Option to purchase 20 hectares of mineral concessions and staking addition concessions.





For the year ended December 31, 2011, "Exploration And Evaluation Assets" costs totaled $2,570,758 (2010 - $1,309,685) and "Mineral Interests Administration And Investigation" expenses totaled $287,369 (2010 - $208,939).





Our assets categorized in the Consolidated Statements Of Financial Position as “Exploration And Evaluation Assets" increased to $13,625,896 at December 31, 2011 as compared to $10,299,789 at December 31, 2010.





The amount of cash on hand at December 31, 2011 was $3,991,264 compared to $4,870,337 at December 31, 2010 and the Company's "Gold and Silver Bullion" holdings had a fair value of $5,807,372 at December 31, 2011 compared to a fair value of $4,107,333 at December 31, 2010. The Company's total assets were $22,397,380 at December 31, 2011 compared to $19,116,519 at December 31, 2010. At December 31, 2011, we were debt-free, apart from accounts payable and accrued liabilities of $89,211 compared to $91,890 at December 31, 2010.




44







The Company raised substantial private placement funding during the later part of 2010 and received significant proceeds of $4,675,500 from the exercise of warrants during 2011, which allowed us to increase our staff and expand our exploration activities and expenditures during 2011 as compared to 2010. Expenditures for categories such as exploration and evaluation assets costs, mineral interests administration and investigation costs, office and miscellaneous, professional fees, salaries and benefits, and travel and promotion have correspondingly increased over the 2010 expenditures.





The following comments relate to certain categories in the consolidated financial statements to December 31, 2011:





Statements of Financial Position


“Gold and Silver Bullion” - During the first quarter of fiscal 2011, the Company used a portion of its cash to purchase an additional $200,000 worth of silver bullion and $799,969 worth of gold bullion to hold in lieu of cash. During the second quarter ended June 30, 20011, the Company used a portion of its cash to purchase approximately $999,980 worth of gold bullion to hold in lieu of cash. During the fourth quarter ended December 31, 2011, the Company sold 35,000 ounces of silver bullion for proceeds of $1,220,291 which resulted in a gain of $229,706 and purchased $509,140 worth of silver. At December 31, 2011, the Company held 87,362.448 grams of gold and 50,018.674 ounces of silver which had a fair value of $5,807,372. The fair value of the Company's gold and silver bullion holdings is determined by the closing prices of gold and silver at the date of the period/year end and also the US dollar exchange rates on these dates. There was a gain of $433,233 on the gold and silver bullion holdings for fiscal 2011. Physical gold and silver bullion are highly liquid and are readily convertible to cash.





Consolidated Statements of Comprehensive Loss


“Stock-Based Compensation” – During the year ended December 31, 2011, the Company granted stock options to consultants, employees, directors and officers on a total of 2,825,000 shares at $0.70 to $1.50 per share with fair values on the grant dates of $3,400,912 of which $2,626,421 was expensed in the statement of comprehensive loss in the category “Stock-Based Compensation” and $774,491 was capitalized to the Los Zorros Property exploration and evaluation assets in relation to options granted to geologist working on the Los Zorros Property. Stock-based compensation costs (the fair value of the options at the grant date) are determined using the Black-Scholes option pricing model which involves the selection of highly subjective assumptions. The following assumptions were used for the Black-Scholes valuations of the stock options granted during the 2011: Expected dividend rate – 0%; Expected stock price volatility – 114% to 135%; Risk-free interest rate – 1.43% to 3.38%; Expected life of options – 5 to 10 years. Changes in these assumptions can materially affect the fair value estimate and therefore the current model may not provide a consistently reliable measure of the fair value cost of the stock options.





"Gain On Gold And Silver Bullion" - Gain of $433,233 - gains or losses are related to the rising or falling prices of gold or silver and the fair value of the Company's gold and silver bullion holdings determined by the closing prices of gold and silver at the date of the period ends and also the US dollar exchange rates on these dates.





Statement of Changes In Shareholders' Equity


"Warrant Extension" - the Company extended the term of 2,871,250 warrants at $1.00 per share by one additional year. This resulted in an incremental increase in the fair value of the warrants of $455,868 that was charged to deficit.





5.B. Liquidity and Capital Resources





Liquidity and Capital Resources 2012-We are an exploration company and do not have any mineral properties in production and, therefore, did not generate any revenue from operations during the year ended December 31, 2012. During the year ended December 31, 2012 we realized a loss from operations of $1,866,307 offset by a recognized gain of $419,332 on the sale of, or changes in fair value of the gold and silver bullion holdings. We realized a net loss of $1,446,975 or $0.02 per share for the year ended December 31, 2012 ($3,708,873 or $0.03 at December 31, 2011). Losses are a reflection of our ongoing expenditures on our mineral property exploration and evaluation assets which are all currently in the exploration stage. Since we have no source of operating revenues, no lines of credit and no current sources of external liquidity, our ability to continue as a going concern is dependent upon our ability to raise additional financing in the future to meet our working capital and on-going cash requirements. We may raise such financing through sales of our equity securities by way of private placements, and/or the exercise of warrants or we may secure additional exploration funding through option or joint venture agreements on our mineral properties or through the sale of our mineral properties, royalty interests or capital assets, or borrow to meet our working capital requirements. Based on current assets on hand at the date of this report, we believe we have sufficient funds to conduct our general operations over the next year, however we may require additional capital to fund our exploration programs over the next year. The Company plans to focus its exploration activities over the next year on its copper-gold-silver projects in Chile. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.




45







In the coming years, we will require substantial additional capital to achieve our goal of discovering significant economic mineralization on one or more of our properties. Until such time as we are able to make such a discovery and thereafter place one or more of our properties into commercial production or negotiate one or more joint venture agreements, we will be largely dependent upon our ability to raise capital from the sale of our securities to fund our operations. We do not anticipate being able to obtain revenue from commercial operations in the short term and anticipate we will be required to raise additional financing in the future to meet our working capital and on-going cash requirements. We intend to raise such financing through sales of our equity securities by way of private placements, and/or the exercise of warrants. We may also secure additional exploration funding through option or joint venture agreements on our mineral properties or through the sale of our mineral properties, royalty interests or capital assets, or borrow to meet our working capital requirements. While we have in the past been able to raise sufficient funds to sustain our exploration programs, there is no assurance that we will continue to be able to do so. If, for any reason, we are not able to access the capital market, our resources during this period will be limited to cash on hand and any revenues we are able to generate from joint venture or similar arrangements we may hereafter enter into. If we are unable to secure sufficient funds to pursue such proposed acquisitions and exploration to the level desired, we will adjust our proposed activities to reflect the amount of capital available to us after providing for sufficient working capital to maintain our existing operations. At present, none of our properties have a known body of ore and all our proposed exploration programs are an exploratory search for ore.See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.





Financing 2010 to 2012-In the past, we have relied in large part on our ability to raise capital from the sale of our securities to fund the acquisition and exploration of our mineral properties. 2010/2011 saw a significant increase in the demand for, and in the price of, gold and silver, and an improved market and price for shares of companies focused on precious metals. These trends during 2010/2011 improved our ability to raise capital at higher prices, on more favourable terms, and in greater amounts than in previous years. During fiscal 2010 we raised a total of $10,162,060 from two private placement at a price of $0.30 per unit and at $0.50 per unit and from the exercise of warrants as follows: during the first quarter ended March 31, 2010, the Company received proceeds of $177,000 from the exercise of warrants for the purchase of 885,000 shares at $0.20 per share. During the second quarter ended June 30, 2010 the Company received proceeds of $10,000 from the exercise of warrants for the purchase of 50,000 shares at $0.20 per share. During the third quarter ended September 30, 2010, the Company completed a private placement of 3,647,334 units at a price of $0.30 per unit for gross proceeds of $1,094,200 and received proceeds of $20,000 from the exercise of warrants for the purchase of 100,000 shares at $0.20 per share. During the fourth quarter ended December 31, 2010, the Company completed a private placement of 17,583,720 units at a price of $0.50 per unit for proceeds of $8,791,860 and received proceeds of $69,000 from the exercise of warrants for the purchase of 345,000 shares at $0.20 per share.





During fiscal 2011, we raised proceeds of $4,675,500 from the exercise of warrants and proceeds of $60,000 from the exercise of stock options as follows: during the first quarter ended March 31, 2011, the Company received proceeds of $1,784,550from the exercise of warrants for the purchase of 195,000 shares at $0.20 per share, 500,000 shares at $0.30 per share, 750,000 shares at $0.70 per share, and 1,372,500 shares at $0.78 per share. During the second quarter ended June 30, 2011 the Company received proceeds of $2,800,950 from the exercise of warrants and $20,000 from the exercise of an option. During the third quarter ended September 30, 2011, the Company received proceeds of $90,000 from the exercise of warrants for 200,000 shares at $0.20 per share and 50,000 shares at $1.00 per share, and proceeds of $40,000 from the exercise of a stock option to acquire 200,000 shares at $0.20 per share.





During the year ended December 31, 2012 we received proceeds of $5,000 from the exercise of a warrant for the purchase of 25,000 shares at $0.20 per share.




46







Use Of Proceeds 2010 to 2012-In 2010 we completed a private placement in the third quarter and in regulatory filings disclosed that the intended use of the proceeds of $1,094,200 would be $800,000 for expenditures/exploration on our mineral properties and $294,200 for general working capital. This intended use of proceeds was more than satisfied as exploration/mineral interests costs totaled $1,309,685 for the 2010 fiscal year. During the fourth quarter of 2010 we completed a private placement and in regulatory filings disclosed that the intended use of the proceeds of $8,791,860 would be $5,000,000 for expenditures/exploration on our mineral properties and $3,791,860 for general working capital. This intended use of proceeds was satisfied by our exploration/mineral interests costs/expenses for 2011 and 2012 as follows:





For the year ended December 31, 2011, our exploration and evaluation assets costs totaled $2,570,758 and mineral interests administration and investigation expenses totaled $287,369. For the year ended December 31, 2012, exploration and evaluation assets costs totaled $5,244,231and mineral interests administration and investigation expenses totaled $387,787.





Anticipated Capital Requirements-Based on current assets on hand at the date of this report, we believe we have sufficient funds to conduct our general operations over the next year, however we may require additional capital to fund our exploration programs over the next year.





While we have in the past been able to raise sufficient funds to sustain our exploration programs, there is no assurance that we will continue to be able to do so. If, for any reason, we are not able to secure equity financings, our resources during this period will be limited to cash on hand and any revenues we are able to generate from joint venture or similar arrangements we may hereafter enter into. If we are unable to secure sufficient funds to pursue exploration to the level desired, we will adjust our proposed activities to reflect the amount of capital available to us after providing for sufficient working capital to maintain our existing operations. Since we own our interests in our mineral properties, we do not have any significant capital obligations to third parties to maintain our property interests other than the payment of periodic patent and other government fees and the payments listed under the “Table of Contractual Obligations” (see below). Our anticipated cash requirements for the year are primarily comprised of the anticipated costs of conducting our exploration programs, our administrative overhead and the obligations listed under the “Table of Contractual Obligations” and other operating expenses in the normal course of business(See Item 5.F “Tabular Disclosure of Contractual Obligations”) and other operating expenses in the normal course of business. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.





5.C. Research and Development, patents and licenses, etc.





We are a mineral exploration company and we do not carry on any research and development activities.





5.D. Trend Information





We anticipate that the price of gold, silver, and copper will continue to be volatile over the next year due in large part to prevailing global economic imbalances and other continuing economic conditions. Metal prices cannot be predicted with accuracy and our plans will be largely dependent upon the timing and outcome of metal markets, particularly the price of gold, silver and copper which is entirely outside of our control. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.





The prices of precious metals and base metals fluctuate widely and are affected by numerous factors beyond our control, including expectations with respect to the rate of inflation, relative strength of the U.S. dollar, Chilean Peso and of other currencies as against the Canadian Dollar, interest rates, and global or regional political or economic crisis. The demand for and supply of precious metals and base metals may affect precious metals and base metals prices but not necessarily in the same manner as supply and demand affect the prices of other commodities. If metal prices are weak, it is more difficult to raise financing for our exploration projects. There is no assurance our attempts to attract capital will be successful. Failure to attract sufficient capital may significantly affect our ability to conduct our planned exploration activities. Conversely, when metal prices are strong, competition for possible mineral properties increases as does the corresponding prices for such prospective acquisitions and the cost of drilling and other resources required to conduct exploration activities.




47







We have followed the policy of, at year end, writing down to nominal value any of our mineral properties on which we have not conducted any significant exploration or acquisition activities during that fiscal year and do not plan to conduct exploration activities within the current year, regardless of our long term view of the prospects of the particular property. Since our future exploration activities are dependent upon a number of uncertainties including our ability to raise the necessary capital (which is in turn affected by external factors such the prices of precious and base metals), we may be required, by application of this accounting policy, to write down other properties now shown as an asset in our consolidated financial statements to nominal value, even though we may intend to conduct future exploration activities on them after the current fiscal period.





As a junior exploration company, our operations are significantly affected by a number of external factors, particularly those that affect the price of the commodities we explore for or those that affect the market for our securities. During 2012, the global economy was still experiencing the after-shocks of the 2008-2009 financial crisis and ensuing recession, as well as the impact of measures taken to counteract its effects. In response to the crises, many governments engaged in broad economic stimulus activities and expansionist monetary policies, resulting in large fiscal deficits and unprecedented levels of government debt and slow or negative growth and high levels of unemployment, particularly in Greece and Spain. These and other factors gave rise to mounting concern over the possibility of sovereign debt default and a systemic financial failure in the Euro-zone resulting in broader financial contagion. In addition, new concerns began to develop over the appearance of asset bubbles, and a general slowdown in China and other developing economies. Although the United States and certain other countries began to show signs of moderate growth during 2012, and the Euro-zone successfully avoided or contained its most serious financial threats, these concerns and the underlying financial conditions that gave rise to them, persisted throughout 2012, although in a more muted form.





In light of, and likely in response to these and other factors, the price of gold, which rose to over $1,900/oz. during 2011, before dropping back to $1,700 range, continued to rise somewhat during 2012, although with considerable volatility. The price of silver, which rose to over $48 in 2011, ending the year around $30, rose slightly during 2012, although, again, with considerable volatility. Although, the market for shares of junior precious metal explorers also improved briefly with the increase in precious metal prices, the market for the shares of junior exploration companies declined significantly in 2012, making it much more difficult for companies to raise capital for exploration. Further, while precious metals have remained relatively strong they have shown considerable volatility, including the largest one-day decline in over 30 years in mid-April 2013, recovering in part shortly thereafter. This in turn has had a further negative effect on the market for shares of all mining companies, particularly junior exploration companies. While these trends have not yet had a direct effect on the Company, since we have had sufficient funds to cover our general operations and exploration programs, they may impact our future operations since we are dependent upon our ability to access capital markets in order to fund our general operations and exploration programs. See “Special Note Regarding Forward Looking Statements” and “Risk Factors”.





5.E. Off Balance Sheet Arrangements





At December 31, 2012, we did not have any material off-balance sheet arrangements out of the ordinary course of business other than employment or consulting agreements with our executives. Currently, we do not have any material off-balance sheet arrangements out of the ordinary course of business, other than as expressly disclosed elsewhere herein.





5.F Tabular Disclosure of Contractual Obligations





The following table summarizes our contractual obligations atApril 26, 2013and the effect these obligations are expected to have on our liquidity and cash flows in future periods.




48








Payment Due By PeriodContractual Obligations

Total

Less than a year

1-3 Years

4-5 Years

After 5 YearsPurchase NSR Royalty (1)

US$10,000

US$10,000Capital (Finances)

Lease Obligations

NILLon-term Debt

Obligations

NILOperating Lease

Obligations

NILPurchase Obligations

Equipment

NILOther Long-term

Liabilities

NILTotal Contractual

Obligations and

Commitments

US$10,000

US$10,000





(1) Pursuant to a royalty purchase contract dated August 20, 2012 the Company is buying out the 1% NSR royalty on the Providencia Mine concessions (which comprise a portion of the INCA Property) for the Chilean peso equivalent of US$50,000 by making 10 monthly payments as follows: US$5,000 on August 31, 2012 (paid); US$5,000 on October 4, 2012 (paid); US$5,000 on November 4, 2012 (paid); US$5,000 on December 4, 2012 (paid); US$5,000 on January 4, 2013 (paid); US$5,000 on February 4, 2013 (paid); US$5,000 on March 4, 2013 (paid); US$5,000 on April 4, 2013 (paid); US$5,000 on May 4, 2013; and US$5,000 on June 4, 2013. (see INCA Property in Note 6 “Exploration And Evaluation Assets” to the Consolidated Financial Statements) (see Item 4.B "Description of Property", "INCA Property").





5.G. Safe Harbor





Information provided pursuant to Items 5.E and 5.F may contain forward-looking information which may vary from actual results. See “Special Note Regarding Forward Looking Statements”.





Item 6. Directors, Senior Management And Employees




6.A. Directors and Senior Management.




The following table sets out the names of our directors, management and employees we depend on, and their positions and offices at April 26, 2013.All four of our directors are residents of the United States. None of our directors serve as directors for other public issuers except for independent director, James Pappas, who is also a director of Morgan's Foods Inc.(Ticker: MRFD).





Name, Age, Municipality of

Residence and Position
Present and Principal Occupation

During the Last Five Years
Date of First Appointment

as Executive Officer
Date of FirstAppointment

as DirectorSasan Sadeghpour, 31

Houston, Texas

Director, Chairman and Interim Chief Executive Officer
Investment Manager/General Manager
January 15, 2013
September 10, 2012Patrick M. Cahill, 53

The Woodlands, Texas

Director
Financial/Operational Consultant
N/A
January 15, 2013James C. Pappas, 32

Houston, Texas

Director
Investment Manager/General Partner
N/A
January 15, 2013Travis W. Cocke, 26

The Woodlands, Texas

Director
Investment Manager/Analyst
N/A
January 15, 2013Juan Carlos Toro Taylor,63

Santiago, Chile

Chief Geologist
Consulting Geologist
N/A
N/ALarry D. McLean, 63

Abbotsford, British Columbia

Interim Chief Financial Officer

(husband of Brenda McLean)
CFO/Operations Manager
November 3, 1995
N/ABrenda McLean, 61

Abbotsford, British Columbia

Interim Corporate Secretary

(wife of Larry McLean)
Corporate Secretary
November 3, 1995
N/A





Executive officers are appointed by the Board of Directors to serve until their successors are appointed.




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6.B. Compensation.




During the year ended December 31, 2012, employees who were also former directors or officers of the Company were paid salaries totaling $523,800 including $177,000 to Jeffrey Dahl, former President and Chief Executive Officer, $162,000 to Robert Kell, former Vice President-Exploration, $114,000 to Larry McLean, former Vice President–Operations and Chief Financial Officer, and $70,800 to former Corporate Secretary, Brenda McLean. Compensation for all of our executives is subject to review and approval by the Compensation Committee. See Item 6.C “Board Practices – Compensation Committee”.





A former director of the Company charged $6,000 during the year ended December 31, 2012 for providing research and consulting services for the Company's Board of Directors. A former director of the Company provided legal services to us through Leschert & Company Law Corporation which charged $204,147 for legal services during the year ended December 31, 2012. During the year ended December 31, 2012, pursuant to a settlement agreement dated September 10, 2012, $50,000 was paid to Sasco Partners, LP, controlled by Sasan Sadeghpour, a director of the Company, to reimburse for legal fees.





In fiscal 2011, the Company entered into formal agreements with its senior staff (Jeff Dahl, Larry McLean, Brenda McLean, Rob Kell and Phil Southam) effective October 1, 2011 reflecting compensation and terms of employment in effect as at that date, which formalized prior verbal arrangements with such individuals as at that date and clarified certain provisions respecting employment duties, use of confidential information, and provisions applicable upon cessation of employment. Among other things, the agreements, all of which are in similar form, provided that all confidential information held or work product developed by the employee will remain the property of the Company upon termination. The Agreements also provided that if the employee were terminated for ‘cause’ (as interpreted by courts in Canada), the employee would be entitled only to compensation (salary, expenses, bonuses and stock options) (“Compensation”) earned up to the time of termination, but if terminated without ‘cause’, including constructive termination due to a material change in the employee's conditions of employment, remuneration, position, duties or reporting structure, within 24 months following a change of control, the Company will be required to either give prior notice of such proposed termination for terms ranging from 18 to 24 months (the “Notice Period”) or pay Compensation which would have been payable during the Notice Period in lieu. The Agreement provided further that the employee was also required to remain available after termination on a limited consulting basis for the purpose of providing documentation and information arising from their prior employment for an additional period after termination equal to the Notice Period in consideration for retention during such period of any incentive stock options held by them at termination.





Subsequent to the year ended December 31, 2012, severance totaling $1,341,734 was paid to employees and a consultant of the Company that were terminated pursuant to the change in management effected January 15, 2013 (a $1,188,000 portion of the severance was paid to employees and a consultant who were former directors or officers of the Company). In conjunction with these changes, certain former directors agreed to the cancellation of certain incentive stock options and the individual former employees, consultant and former directors entered into certain Advisory Agreements whereby they agreed to continue to provide certain limited consulting and assistance to the Company in consideration for the continuation of certain other previously granted stock options. See Item 5.A "Operating Results - Settlement Agreement"; Item 6.B. Compensation "Stock Options"; Item 7.B. "Related Party Transactions" and Item 10.C. "Material Contracts".





Subsequent to the year ended December 31, 2012, on April 2, 2013, US$78,429 was paid to Sasco Partners, LP, controlled by Sasan Sadeghpour, a director of the Company, to reimburse for legal fees.




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Prior to the change in management effected January 15, 2013, former directors did not receive any monies for serving in their capacity as directors. Subsequent to January 15, 2013, it was resolved that the Company will pay a fee of $5,000 USD to each director on a quarterly basis at the beginning of each quarter for serving in their capacity as directors. Sasan Sadeghpour, director, Chairman and Interim Chief Executive Officer has declined this fee.





Except as otherwise disclosed herein, we have not entered into any employment or management agreements with any of our directors or executive officers. In addition, we do not currently have any retirement, pension, bonus, profit-sharing or similar plans and none are proposed at this time.





Incentive Stock Options




In order to attract and retain highly qualified personnel, we provide incentives in the form of stock options to certain of our qualified employees, directors, officers and consultants on terms and conditions which are in accordance the Company’s Stock Option Plan and the prevailing rules and policies of the TSX Venture Exchange, and our Board of Directors.





At our Annual General Meetings held on May 29, 2008, May 26, 2009, May 26, 2010, June 7, 2011, and October 1, 2012 the shareholders passed ordinary resolutions giving annual approval to the Company’s “rolling” stock option plan. Under the terms of the Company’s Stock Option Plan (the “Plan”), our Board of Directors are authorized to grant options to any person who is an employee, director, officer, or consultant for us or one of our subsidiaries and who is not otherwise prevented from receiving the Option under the terms of applicable policy of the TSX-V or a company which is owned by one or more such individuals (an “Eligible Person”). The maximum number of Common Shares which may be reserved for issuance under the Plan is 10% of the Common Shares outstanding at the time of the grant (on a non-diluted basis) less the aggregate number of Common Shares reserved for issuance under any other existing stock options or similar share compensation arrangement and the maximum number which may be reserved for issuance to any one person under the Plan is 5% (unless otherwise approved by a majority of disinterested shareholders, which approval has not been sought or granted). Our Board of Directors is entitled, subject to the requirements of applicable TSX-V policy, to set the exercise price of each option (provided it is greater than the minimum prescribed under TSX-V Policy), the term during which it may be exercised (to a maximum of 10 years) and any vesting provisions as they may deem appropriate and as are in compliance with TSX-V policy. Any options granted under the Plan are exercisable only while the holder remains an Eligible Person or the time period determined by the Board of Directors after ceasing to be an Eligible Person, and are not assignable or transferable other than by will or the laws of descent and distribution.





Fiscal 2011 Stock Options - During the first quarter of 2011, the Company granted a stock option to a new director for the purchase of 200,000 shares at a price of $0.70 per share with a fair value on the grant date of $132,130 that was expensed in the statements of comprehensive loss in the category “Stock-based compensation”. During the second quarter of 2011, the Company granted options on 525,000 shares at $1.50 per share to consultants and employees of the Company, and options to directors and officers on 1,900,000 shares at a price of $1.50 per share with a fair value on the grant date of $3,101,875, of which a $2,494,291 portion was expensed in “Stock-based compensation” and $607,584 was capitalized in exploration and evaluation assets in relation to stock options granted to geologists working on the Los Zorros Property. During the second quarter, an option on 100,000 shares at $0.20 per share was exercised for proceeds of $20,000. During the third quarter of 2011, the Company granted a stock option on 100,000 shares at $1.40 per share with a fair value on the grant date of $111,894 that was capitalized in exploration and evaluation assets in relation to the option granted to a geologist working on the Los Zorros Property. During the third quarter, one of our directors exercised a stock option to acquire 200,000 shares at $0.20 per share for proceeds of $40,000 to the Company. During the fourth quarter of 2011, the Company granted a stock option on 100,000 shares at $0.70 per share with a fair value on the grant date of $55,014 that was capitalized in exploration and evaluation assets in relation to the option granted to a geologist working on the Los Zorros Property.





Fiscal 2012 Stock Options – During the year ended December 31, 2012, the Company granted an employee/geologist a stock option on 100,000 shares at $0.50 per share with a fair value on the grant date of $26,891 which was capitalized to the Los Zorros Property exploration and evaluation costs as stock-based compensation. During the year ended December 31, 2012, options expired on 50,000 shares at $0.80; 100,000 shares at $1.40; 60,000 shares at $0.70; and 100,000 shares at $0.70. During the third quarter of 2012, options on a total of 525,000 shares at $1.50 per share were cancelled/forfeited pursuant to the Settlement Agreement dated September 10, 2012 reached between SAMEX and Sasco/Sasan Sadeghpour whereby five former directors each forfeited a portion of $1.50 options they had originally been granted.




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Subsequent to the year ended December 31, 2012 - Options on 750,000 shares at $1.50 per share were cancelled/forfeited by former directors, employees and a consultant of the Company that were terminated pursuant to a change in management effected January 15, 2013. In conjunction with these changes, certain former directors agreed to the cancellation of certain incentive stock options and the individual former employees, consultant and former directors entered into certain Advisory Agreements whereby they agreed to continue to provide certain limited consulting services and assistance to the Company in consideration for the continuation of certain other previously granted stock options. See Item 5.A "Operating Results - Settlement Agreement"; Item 6.B. Compensation "Stock Options"; Item 7.B. "Related Party Transactions" and Item 10.C. "Material Contracts".





On March 1, 2013 the Company granted options to three new directors of the Company on an aggregate of 750,000 shares at $0.14 per share. On April 3, 2013 the Company granted an option to a consultant on 300,000 shares at $0.16 per share.





At April 26, 2013options were outstanding to acquire 10,895,000 common shares as shown in the table below. The outstanding options consist of an aggregate of 3,100,000 shares for directors/officers; 1,650,000 shares for employees and consultants; and 6,145,000 shares for former directors and a former employee.





Optionee
Date of Option
# of Shares
Price
Expiry DateJames Pappas
March 1, 2013
250,000
$0.14
March 1, 2018Travis Cocke
March 1, 2013
250,000
$0.14
March 1, 2018Patrick Cahill
March 1, 2013
250,000
$0.14
March 1, 2018Juan Carlos Toro Taylor
April 3, 2013
300,000
$0.16
April 3, 2018Larry McLean
April 20, 2005

May 2, 2006

February 23, 2007

September 4, 2009

May 2, 2011
350,000

300,000

250,000

625,000

75,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015Brenda McLean
April 20, 2005

May 2, 2006

February 23, 2007

September 4, 2009

May 2, 2011
175,000

150,000

75,000

250,000

100,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015Francisco Vergara
May 2, 2006

September 4, 2009

September 16, 2010

May 2, 2011
50,000

150,000

100,000

100,000
$0.85

$0.20

$0.35

$1.50
May 2, 2016

September 4, 2019

September 16, 2015

May 2, 2021Manuel Avalos
May 2, 2006

September 4, 2009

September 16, 2010

May 2, 2011
100,000

150,000

150,000

100,000
$0.85

$0.20

$0.35

$1.50
May 2, 2016

September 4, 2019

September 16, 2015

May 2, 2021Jorge Humphreys
May 2, 2006
20,000
$0.85
May 2, 2016Jorge Espinoza
May 2, 2006
30,000
$0.85
May 2, 2016Adrian Douglas
January 15, 2009

September 4, 2009

January 29, 2010

May 2, 2011
60,000

30,000

110,000

200,000
$0.20

$0.20

$0.35

$1.50
July 17, 2013

July 17, 2013

July 17, 2013

July 17, 2013Jeffrey Dahl
April 20, 2005

May 2, 2006

February 23, 2007

September 4, 2009

May 2, 2011
350,000

300,000

270,000

625,000

75,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015  52
 
  Peter Dahl
April 20, 2005

May 2, 2006

February 23, 2007

September 4, 2009
350,000

150,000

150,000

400,000
$0.40

$0.85

$0.84

$0.20
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015Robert Kell
April 20, 2005

May 2, 2006

February 23, 2007

September 4, 2009

May 2, 2011
350,000

300,000

275,000

625,000

75,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015Allen Leschert
April 20, 2005

May 2, 2006

February 23, 2007

September 4, 2009

May 2, 2011
350,000

150,000

150,000

200,000

75,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015Malcolm Fraser
January 6, 2011

May 2, 2011
200,000

225,000
$0.70

$1.50
April 7, 2015

April 7, 2015Philip Southam
April 20, 2005

May 2, 2006

September 4, 2009

September 16, 2010

May 2, 2011
30,000

70,000

150,000

150,000

100,000
$0.40

$0.85

$0.20

$0.35

$1.50
August 5, 2014

August 5, 2014

August 5, 2014

August 5, 2014

August 5, 2014





6.C. Board Practices.




Our current board of directors consists of four members, the terms of which expire at the general meeting of shareholders to be held each year. Directors are elected by a majorityof the votes of our common shares present in person or represented by proxy at our annual meeting of shareholders and entitled to vote at such election. Each director will hold office until his or her term expires and his or her successor has been elected and qualified. Executive officers serve at the discretion of the board of directors. Officers are elected at the annual meeting of the directors held immediately after the annual general meeting of shareholders.





We have granted and intend to continue to grant incentive stock options to employees, directors, officers and consultants on terms and conditions established by the Company’s Stock Option Plan and in accordance with prevailing policy of the TSX Venture Exchange, as summarized in Item 6. “Directors, Senior Management and Employees; Compensation – Incentive Stock Options”.





Prior to the change in management effected January 15, 2013, former directors did not receive any monies for serving in their capacity as directors. Subsequent to January 15, 2013, it was resolved that the Company will pay a fee of $5,000 USD to each director on a quarterly basis at the beginning of each quarter for serving in their capacity as directors. Sasan Sadeghpour, director, Chairman and Interim Chief Executive Officer has declined this fee.





Except as disclosed herein, we have not entered into any service or employment agreements with any of our directors or officers. We do not have any retirement, pension, profit-sharing or such similar plans and none are proposed at the present time.





Audit Committee





The Audit Committee functions under an Audit Committee Charter adopted by the Board of Directors. The Audit Committee’s primary function is to review the annual audited financial statements with the Company’s external auditor (the “Auditor”) prior to presentation to the Board and to make recommendations thereon, together with recommendations to the Board with respect to such financial statements and compensation payable to the Auditor. The Audit Committee also reviews the Company’s interim un-audited quarterly financial statements prior to finalization and publication. The Audit Committee also provides review oversight with respect to pre-approval of all non-audit services to be provided by the Auditor to the Company and a number of other related matters including issues related to a change of auditors and establishing procedures for treatment of complaints regarding accounting, internal accounting controls or auditing matters. The Audit Committee meets as a separate committee of the board as and when needed to carry out its functions and keeps formal minutes of its proceedings.




53







During the fiscal period ended December 31, 2012 and continuing until January 15, 2013, the Company's Audit Committee was composed of former director, Vice President Operations and Chief Financial Officer of the Company, Larry McLean, who was not independent, and the following three audit committee members who the Board of Directors had determined to be independent in accordance with the requirements of our Audit Committee Charter: former director Allen Leschert; former director Malcolm Fraser; and director, Sasan Sadeghpour (appointed as a director on September 10, 2012). Larry McLean and Allen Leschert had been directors of the Company since 1995 and Malcolm Fraser was appointed as a director on January 6, 2011. All four Audit Committee members are “financially literate”: Allen Leschert, Malcolm Fraser and Larry Mclean had, in the course of their duties, engaged in the review and analysis of - and/or had actively supervised persons engaged in the preparation, auditing and analysis of - numerous interim and annual financial statements for the Company, as well as for other public companies for which they have served as directors or officers. Allen Leschert, who served as audit committee chairman, also has more than 25 years experience as a securities lawyer. In addition to holding a law degree, he also holds a B. Comm. (with distinction), specializing in Corporate Finance and Accounting. Sasan Sadeghpour has financial experience and is the President and Chief Investment Officer of Sasco Investments, LP and has managed hedge fund Sasco Partners, LP since its inception in January 2004.





The Company's current Audit Committee effective January 15, 2013, is composed of Sasan Sadeghpour, Director, Chairman, and Interim Chief Executive Officer, who is not independent, and independent directors, James Pappas, Travis Cocke, and Patrick M. Cahill. Sasan Sadeghpour has been a director of the Company since September 10, 2012 and James Pappas, Travis Cocke, and Patrick M. Cahill were appointed to the Board on January 15, 2013. All four of the Audit Committee members are “financially literate”: Sasan Sadeghpour has financial experience and is the President and Chief Investment Officer of Sasco Investments, LP and has managed hedge fund Sasco Partners, LP since its inception in January 2004; James Pappas is an investment manager and general partner of entities whose principal business is investing in securities. Mr. Pappas received a Bachelor of Business Administration, and a Masters in Finance from Texas A&M University; Travis Cocke has experience as an investment portfolio manager and is managing member for several private investment partnerships with interest in real estate and public equities. Mr. Cocke received a BBA in Finance from Texas A&M University; Patrick M. Cahill, CPA, has experience as a Controller and Chief Financial Officer and is currently an independent consultant assisting companies on financial and operational projects. Mr. Cahill is a graduate of The McCombs School of Business at The University of Texas.





Compensation Committee





The Compensation Committee's primary function is to assist and advise the Board of Directors with respect to any and all matters relating to the compensation of the executive officers of the Company or other such persons as the Board may from time to time request. The Compensation Committee meets as a separate committee of the board as and when needed to carry out its functions and keeps formal minutes of its proceedings. Prior to January 15, 2013, the Company's Compensation Committee was composed of former directors Allen Leschert, Malcolm Fraser and Larry McLean, and director, Sasan Sadeghpour (appointed to Compensation Committee on September 10, 2012). The current Compensation Committee is composed of independent directors, James Pappas, Travis Cocke, and Patrick M. Cahill.





6.D. Employees.




We had from 25 to 27 employees during 2012 with 26 employees at the year-end of December 31, 2012. At April 26, 2013, we had 18 employees, all of which were involved in activities related to our mineral exploration properties in Chile. A summary of employees over the last three fiscal years is set out below. The majority of our employees during 2012 were involved in activities related to our mineral exploration properties in Chile. None of our employees are represented by unions or covered by collective bargaining agreements.




54







Year ending
Category of Activity
Location
Total Number of Employees perCanada
Chile
Bolivia
Category and Total at Year EndDecember 31, 2012
Exploration
-
21
-
21Administrative/Office
4
1
-
5Total:


-
26December 31, 2011
Exploration
-
22
-
22Administrative/Office
4
1
-
5Total:


-
27December 31, 2010
Exploration
-
16
-
16Administrative/Office
4
1
-
5Total:
4
17
-
21





Share ownership.




The following table sets forth the shareholdings, to our knowledge, owned beneficially, directly or indirectly, by our directors and members of our administrative, supervisory or management bodies as ofApril 26, 2013. There were 126,733,719 common shares issued and outstanding as ofApril 26, 2013.




Name and Position
Number of Shares of

SAMEX Owned
Percentage of Shares Owned atApril 26/13
Incentive Stock

Options OwnedNumber of Shares under Option
Exercise

Price
Expiry

DateSasan Sadeghpour

Director, Chairman and Interim Chief Executive Officer
29,965,368(1)
23.6%
nil
n/a
n/aPatrick M. Cahill

Director
nil
-
250,000
$0.14
March 1, 2018James C. Pappas

Director
nil
-
250,000
$0.14
March 1, 2018Travis W. Cocke

Director
nil
-
250,000
$0.14
March 1, 2018Juan Carlos Toro Taylor

Chief Geologist
nil
-
300,000
$0.16
April 3, 2018Larry D. McLean

Interim Chief Financial Officer
511,525
.40%
350,000

300,000

250,000

625,000

75,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015Brenda L. McLean

Interim Corporate Secretary
303,975
.24%
175,000

150,000

75,000

250,000

100,000
$0.40

$0.85

$0.84

$0.20

$1.50
April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015

April 7, 2015





(1)11,887,668 shares are held directly and 18,077,700 are held indirectly by Sasco Partners, LP




55








Statements as to securities beneficially owned by the individuals, or as to securities over which they exercise control or direction, are based upon information obtained from such individuals and from records available to the Company. For particulars on outstanding stock options, see “Item 6. Directors, Senior Management and Employees – Compensation – Incentive Stock Options”.





Item 7. Major Shareholders And Related Party Transactions




7.A. Major Shareholders.




As at March 31, 2013, 126,733,719 common shares of the Company were issued and outstanding. At that date, we had 143 shareholders of record with addresses in the United States holding an aggregate of 41,682,954 common shares representing 32.89% of our common shares. A further 39,108,754 shares are beneficially held by seven shareholders known by management to be U.S. residents, with shares representing an additional 30.9% of our common shares. To our knowledge, no person beneficially owns, directly or indirectly or exercises control or direction over, or has a combination of direct or indirect beneficial ownership of and control or direction over, shares carrying more than 5% of the voting rights attached to our issued and outstanding common shares at March 31, 2013 except as follows:





Name and Address
Number of Shares
Percentage of Issued SharesSASAN SADEGHPOUR, Suite 1107 – 2001 Kirby Drive, Houston, Texas 77019
29,965,368(1)
23.6%CDS & CO, NCI Account, 25 The EsplanadePO Box 1038, Station A, Toronto, ON, M5W 1G5
63,738,299(2)
50.29%CEDE & CO, PO Box 20, Bowling Green Stn, New York, NY 10274, United States
38,023,455(2)
30.0%





(1) 11,887,668 shares are held directly and 18,077,700 shares are held by Sasco Partners, LP, which is indirectly controlled by Sasan Sadeghpour. A further 11,025,834 share purchase warrants are held by Mr. Sadeghpour which, if exercised would increase his direct and indirect holdings to 40,991,202 shares representing 29.8% of the shares of the Company then outstanding.





(2)This holder acts as a depository for brokerage firms and other intermediaries. Management of the Company is unaware of the beneficial owners of these shares, other than 18,077,700 of such shares beneficially held by Sasco Partners, LP.





Mr. Sadeghpour acquired his shares by way of private placements and open market purchases. His position (which includes shares held by Sasco Partners LP) increased to in excess of 5% upon purchase of a private placement of 10,164,000 units (each of which was comprised of 1 share and 1 warrant) which, together with shares and warrants then held by him increased his security holding position to 11,887,667 shares and 11,025,834 warrants, representing approximately 9.97% of the Company’s then issued and outstanding shares (22,913,501 shares representing 17.6% upon exercise). The warrants issued under the second placement contained certain restrictions blocking exercise where his holdings would thereby increase to 10% (the “10% Blocker Restriction”) or 20% (the 20% Blocker Restriction”) of the Company’s issued and outstanding shares, unless certain conditions were met. Mr. Sadgedepour’s position increased to in excess of 10% by market purchase of 105,000 shares made prior to December 28, 2010 and then increased again to in excess of 25,618,468 shares representing over 20% of the Company’s then issued and outstanding shares as a result of additional market purchases made prior to April 27, 2011. The shareholders, by way of special resolution passed at the Annual General Meeting held on June 7, 2011, agreed to remove the “20% Blocker Restriction” contained in the warrants allowing him to increase his share position beyond 20%. His position increased to29,965,368shares (23.6% of the Company’s shares issued and outstanding) as a result of further market purchases.





The above information was supplied by the Company’s transfer agent, Computershare Investor Services or was provided by the respective shareholders directly or through public filings on the SEDAR and SEDI filling systems. All of our common shares have identical voting rights.




56








7.B. Related Party Transactions.




Except where described elsewhere in this Annual Report, we have not, during the last completed fiscal year ended December 31, 2012 and the subsequent period to April 26, 2013, entered into transactions or loans with any (a) enterprises that are directly or indirectly controlled by or under common control with us; (b) our associates; (c) individuals directly or indirectly owning voting right which give them significant influence over us or close members of their respective families, (d) our directors, senior management or close members of their respective families or (e) enterprises in which a significant voting is held or significantly influenced by any of the foregoing individuals (a “Related Party”), except as follows:





Settlement Agreement





On September 10, 2012, SAMEX, resolved a dispute with Sasan Sadeghpour, our Interim CEO, and Sasco Partners, LP, an investment fund controlled by him (“Sasco”), resulting in an agreement dated September 10, 2012 between Sasco Partners, LP and Sasan Sadeghpour, the Company, the Company's former board of directors, Peter J. Dahl, Jeffrey P. Dahl, Robert E. Kell, Larry D. McLean, Allen D. Leschert and Malcolm B. Fraser (the “Former Board”), its corporate secretary, Brenda McLean and senior geologist, Phil Southam (the "Settlement Agreement"). Under the terms of the Agreement, effective September 10, 2012:





·
Peter Dahl resigned as a Director and as Board Chair;





·
Sasan Sadeghpour was appointed as a Director, Board Chair and a member of the Audit Committee and the Compensation Committee.




·
225,000 options held by Peter Dahl and exercisable at $1.50 were cancelled





·
300,000 options held by certain of the Former Board Members and exercisable at $1.50 were cancelled;





·
Peter Dahl entered into an advisory agreement with the Company whereby he agreed to provide continuing limited consulting advice to the Company’s board and senior management team for a period of two years, in consideration for retention of his remaining options;





·
the expiry date of 17,583,720 warrants issued pursuant to a private placement of the Company on November 1, 2010, 10,164,000 of which are held by Sasan Sadeghpour, a Director and our Interim CEO, was extended by two years to November 2, 2014





·
$50,000 was paid to Sasco to reimburse it for legal fees;





·
The Company granted Sasco certain “veto rights” over certain transactions including the grant of any bonuses or salary increases to anyCanadian-based employee of the Company, entering into certain major transactions or corporate reorganizations, all of which require Sasco’s prior written consent. These rights continue until completion of the 2014 annual general meeting of the shareholders of the Company or for such longer period as the Board of Directors may determine, so long as Sasco continues to hold 50% or more of the common shares of the Company that it owned as of the date of the Settlement Agreement.




·
The Former Board and former employees who were party to the Settlement Agreement agreed to certain restrictions on proxy solicitation, entering into voting arrangements, requisitioning shareholder meetings, seeking removal of directors of the Company or similar transactions effective until completion of the 2014 annual general meeting of the shareholders of the Company.




·
The Former Board, Brenda McLean and Phil Southam tendered their resignations along with certain other documents in escrow, granting Sasco the right, in its sole discretion, to request delivery of same to the Company on or after January 1, 2013. The Settlement Agreement also provided that if the resignations of any of Jeffrey Dahl, Robert Kell, Larry McLean, Brenda McLean or Phil Southam (collectively, the "Employees") were delivered, they would become entitled to receive severance payments from the Company in accordance with the terms of their respective employment or consulting agreements.




57








Subsequent to the end of the December 31, 2012 fiscal year, effective January 15, 2013, the resignations of the Former Board and the Employees were delivered, resulting in termination of the Employees and change of management of the Company under the terms of the Settlement Agreement. As a result, severance totaling $1,341,734 was paid to the Employees, $1,188,000 of which was paid to Employees who were also former directors or officers of the Company. The Company also cancelled a total of 750,000 options exercisable at $1.50 per share held by certain of the Former Directors. All of the resigning directors and officers entered into Advisory Agreements with the Company whereby they agreed to continue to act as limited consultants to the Company for a period of 2 years in order to ensure an efficient and orderly transition to new management in consideration for the continuation of certain other previously granted stock options. See Item 5.A. "Operating Results - Settlement Agreement"; Item 6.B. Compensation "Stock Options"; and Item10.C. "Material Contracts".





Sasan Sadeghpour, Director and Chairman of the Company, agreed to act as Interim Chief Executive Officer of the Company at an annual salary of $1.00. Larry D. McLean and Brenda McLean agreed to continue in a consulting role as Interim Chief Financial Officer and Interim Corporate Secretary, respectively, up to April 30, 2013 or until their permanent replacements are appointed.See Item 5.A. “Operating Results – Settlement Agreement”.





Stock Options





Under the terms of the Settlement Agreement, the company cancelled certain stock options granted to former directors and officers, who also retained certain options granted to them while in office subsequent to their resignation from office. Subsequent to the fiscal year ending December 31, 2012, the Company granted incentive stock options to certain of its Directors appointed as part of the management change effected on January 15, 2013. Particulars of these transactions are set out below.





Stock Options Granted to Related Parties*:





Related Party Name/Position
Date Option

Granted *
#

of Shares
Exercise

Price/Share
Expiry

DatePatrick M. Cahill

Director
March 1, 2013
250,000
$0.14
March 1, 2018James C. Pappas

Director
March 1, 2013
250,000
$0.14
March 1, 2018Travis W. Cocke

Director
March 1, 2013
250,000
$0.14
March 1, 2018





*See “Item 6. Directors, Senior Management and Employees – Compensation – Incentive Stock Options”.





Options Cancelled by Related Parties under Settlement Agreement*





Related Party Name/Position
Date Option

Granted
# of Shares

Cancelled
Exercise

Price/Share
Expiry

DateJeffrey Dahl

Former Director, President, CEO
May 2, 2011
300,000
$1.50
May 2, 2021Peter Dahl

Former Director and Chairman
May 2, 2011
225,000
$1.50
May 2, 2021Robert Kell

Former Director, Vice President - Exploration
May 2, 2011
300,000
$1.50
May 2, 2021Larry McLean

Former Director, Vice President – Operations, CFO; Current Interim CFO
May 2, 2011
300,000
$1.50
May 2, 2021Allen Leschert

Former Director
May 2, 2011
150,000
$1.50
May 2, 2021





* See Item 5.A. "Operating Results - Settlement Agreement"; Item 6.B. Compensation "Stock Options"; and Item 10.C. "Material Contracts".




58








Options Retained by Related Parties under Settlement Agreement*





Optionee
Date of Option
# of Shares
Price
New Expiry Date*Jeffrey Dahl

Former Director, President, CEO
20-Apr-05
350,000
$0.40
April 7, 201502-May-06
300,000
$0.85
April 7, 201523-Feb-07
270,000
$0.84
April 7, 201504-Sep-09
625,000
$0.20
April 7, 201502-May-11
75,000
$1.50
April 7, 2015Peter Dahl

Former Director and Chairman
20-Apr-05
350,000
$0.40
April 7, 201502-May-06
150,000
$0.85
April 7, 201523-Feb-07
150,000
$0.84
April 7, 201504-Sep-09
400,000
$0.20
April 7, 2015Robert Kell

Former Director, Vice President - Exploration
20-Apr-05
350,000
$0.40
April 7, 201502-May-06
300,000
$0.85
April 7, 201523-Feb-07
275,000
$0.84
April 7, 201504-Sep-09
625,000
$0.20
April 7, 201502-May-11
75,000
$1.50
April 7, 2015Larry McLean

Former Director, Vice President – Operations, CFO;

Current Interim CFO
20-Apr-05
350,000
$0.40
April 7, 201502-May-06
300,000
$0.85
April 7, 201523-Feb-07
250,000
$0.84
April 7, 201504-Sep-09
625,000
$0.20
April 7, 201502-May-11
75,000
$1.50
April 7, 2015Allen Leschert

Former Director
20-Apr-05
350,000
$0.40
April 7, 201502-May-06
150,000
$0.85
April 7, 201523-Feb-07
150,000
$0.84
April 7, 201504-Sep-09
200,000
$0.20
April 7, 201502-May-11
75,000
$1.50
April 7, 2015Malcolm Fraser

Former Director
06-Jan-11
200,000
$0.70
April 7, 20152-May-11
225,000
$1.50
April 7, 2015Brenda McLean

Former Corporate Secretary

Current Interim Corporate Secretary
20-Apr-05
175,000
$0.40
April 7, 201502-May-06
150,000
$0.85
April 7, 201523-Feb-07
75,000
$0.84
April 7, 201504-Sep-09
250,000
$0.20
April 7, 201502-May-11
100,000
$1.50
April 7, 2015





* See Item 5.A. "Operating Results - Settlement Agreement"; Item 6.B. Compensation "Stock Options"; and Item 10.C. "Material Contracts".




59








Other Related Party Transactions





A former director of the Company, Malcolm Fraser charged $6,000 during the year ended December 31, 2012 for providing research and consulting services for the Company's Board of Directors.





Allen D. Leschert, who was a director of the Company throughout 2012, continuing until January 15, 2013, provides legal services to us through Leschert & Company Law Corporation. Leschert & Company charged $204,147 for legal services during the fiscal year ended December 31, 2012.





Subsequent to the period ending December 31, 2012, the Company also paid the sum of US$ 78,429 to Sasco Partners, LP, an investment fund controlled by Sasan Sadeghpour, our Interim CEO, as reimbursement of legal fees incurred by Sasco during and prior to negotiation of the Settlement Agreement but not covered by the agreement.





Subsequent to the period ending December 31, 2012, the Company entered into a Consulting Agreement dated January 16, 2013 between the Company and Larry McLean whereby the Company agreed to engage Mr. McLean as a consultant in the capacity of Interim Chief Financial Officer for a period of three and one half months until April 30, 2013 for monthly compensation of $9,500 per month/$438 per day. - See Item 10.C. "Material Contracts" and Item 5.A. "Operating Results - Settlement Agreement".





Subsequent to the period ending December 31, 2012, the Company entered into a Consulting Agreement dated January 16, 2013 between the Company and Brenda McLean whereby the Company agreed to engage Ms. McLean as a consultant in the capacity of Interim Corporate Secretary for a period of three and one half months until April 30, 2013 for monthly compensation of $5,900 per month/$340 per day. - See Item 10.C. "Material Contracts" and Item 5.A. "Operating Results - Settlement Agreement".





No related party is or has been indebted to us or our subsidiaries since December 31, 2012and except as disclosed herein, there are no management, consulting, lease or other agreements in which our management, directors or subsidiaries are parties.




7.C. Interests of Experts and Counsel.




Not Applicable.





Item 8. Financial Information




8.A. Consolidated Statements and Other Financial Information.




Attached hereto, in Item 18 “Financial Statements”, are our audited consolidated financial statements, consisting of Consolidated Statements Of Financial Position and Consolidated Statements of Changes In Shareholder's Equity at December 31, 2012, December 31, 2011 and January 1, 2011, Consolidated Statements of Comprehensive Loss and Consolidated Statements of Cash Flows for the years ended December 31, 2012 and December 31, 2011, together with related notes and schedules and the report of our Auditor. See Item 18 "Financial Statements".





Legal Proceedings




To our knowledge, there are no currently pending or threatened legal proceedings that could have a material effect on our business, results of operations or financial condition.





Dividend Policy




We have never declared or paid any cash dividends on our common shares. As we do not have any earnings, we do not anticipate paying cash dividends on the common shares for the foreseeable future. Future dividends on the commons shares will be determined by the Board of Directors in light of circumstances existing at the time, including our earnings and financial condition. There is no assurance that dividends will ever be paid. See “Special Note Regarding Forward Looking Statements”.




60








8.B. Significant Changes.




Except as disclosed herein,no significant changes have occurred since the date of the annual financial statements.





Item 9. The Offer And Listing.




9.A. Offer and Listing Details.




The following sets forth the price history of our common shares for the period indicated, as reported by the TSX Venture Exchange (Symbol: SXG). They reflect inter-dealer prices, without retail markup, markdown or commissions, and may not represent actual transactions.





Period

High (CDN $)

Low (CDN $)Most Recent Six MonthsMarch 2013

0.18

0.12February 2013

0.17

0.14January 2013

0.22

0.13December 2012

0.19

0.12November 2012

0.18

0.14October 2012

0.21

0.16Financial Year 2012

0.81

0.12Fourth Quarter

0.21

0.12Third Quarter

0.33

0.18Second Quarter

0.50

0.20First Quarter

0.81

0.46Financial Year 2011

1.50

0.46Fourth Quarter

1.07

0.46Third Quarter

1.50

1.00Second Quarter

1.36

0.67First Quarter

0.95

0.61Financial Year 2010

0.82

0.225Financial Year 2009

0.485

0.11Financial Year 2008

0.78

0.115





The closing price of our common shares on the TSX Venture Exchange on April 26, 2013 was $0.14.





The following sets forth the price history of our common shares quoted on the OTCQB tier of the OTC Link (Symbol: SMXMF) for the period indicated, as reported by Yahoo Finance, which receives its financial information from theOTC Markets Group Inc.





Period
High (US$)
Low (US$)Most Recent Six MonthsMarch 2013
0.18
0.11February 2013
0.17
0.13January 2013
0.23
0.12December 2012
0.19
0.12November 2012
0.18
0.14October 2012
0.24
0.17Financial Year 2012
0.79
0.12Fourth Quarter
0.24
0.12Third Quarter
0.34
0.18Second Quarter
0.49
0.20First Quarter
0.79
0.47Financial Year 2011
1.61
0.43Fourth Quarter
1.07
0.43Third Quarter
1.61
0.96Second Quarter
1.50
0.68First Quarter
1.03
0.59Financial Year 2010
0.83
0.20Financial Year 2009
0.50
0.09Financial Year 2008
0.82
0.09




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9.B Plan of distribution.




Not Applicable.





9.C. Markets.




Our Common Shares are quoted in Canada on the TSX Venture Exchange under the trading symbol “SXG” and in the United States on the OTCQB tier of the OTC Link under the trading symbol “SMXMF”.





9.D. Selling shareholders.




Not Applicable.





9.E Dilution.




Not Applicable.





9.F. Expenses of the Issue.




Not Applicable.




Item 10. Additional Information.




10.A. Share capital.




Not Applicable.





10.B. Memorandum and Articles of Association





Corporate Legislation.




We are organized as a corporation under, and operate subject to the Business Corporations Act (British Columbia). See Item 4 “Information On the Company”.





Notice of Articles and Articles of association.




Our Articles and Notice of Articles (our “Constating Documents”) are attached as exhibits hereto as noted in Item 19. Our Articles and Notice of Articles do not contain any limitations on our objects or purposes.





The following is a summary of certain provisions of our Constating Documents:




62







Director's Power To Vote On Matters In Which The Director Is Materially Interested




Our Articles provide that it is the duty of any of our directors who are directly or indirectly interested in an existing or proposed contract or transaction with us to declare the nature of their interest at a meeting of our Board of Directors. In the case of a proposed contract or transaction, the declaration must be made at the meeting of our Board of Directors at which the question of entering into the contract or transaction is first taken into consideration, or if the interested directors are not present at that meeting, our directors are required to declare their interest at the next meeting. If an interested Director votes in favour of such contract or transaction, he or she may be liable to account for any profit obtained therefrom.




Director's Power To Vote On Compensation To Themselves





Subject to theBusiness Corporations Act(British Columbia), our Articles provide that the directors may determine the amount to be paid out of our funds or capital as remuneration for their service. The directors may also determine the proportions and manner that the remuneration will be divided among them. The Directors have, by resolution, formed a Compensation Committee to assist and advise the Board of Directors with respect to any and all matters relating to the compensation of the executive officers of the Company or other such persons as the Board may from time to time request.





Director's Borrowing Powers




Our Articles provide that the directors, on our behalf, may:





(a) raise or borrow money for our purposes upon such terms and conditions as they think fit;





(b) guarantee obligations of any other person;





(c) issue debt obligations as security for loans; and





(d) mortgage or charge any part of our property and assets.





Retirement Of Directors Under An Age Limit Requirement





Our Articles do not require directors to retire prior to a specified age.





Number Of Shares Required For A Director's Qualification




Our Articles do not provide for a requirement of share ownership for a director's qualification.





Changes In Our Capital




Our Articles provide that we may, subject to the Business Corporations Act (British Columbia) and, by special resolution, increase our authorized capital by:





(a) creating shares with par value or shares without par value, or both;





(b) increasing the number of shares with par value or shares without par value, or both; or





(c) increasing the par value of a class of shares with par value, if no shares of that class are issued.





Subject to the Business Corporations Act (British Columbia), the new shares may be issued upon such terms and conditions and with such rights, privileges, limitations, restrictions and conditions attached to them as the special resolution of our shareholders determines.




63







In addition, subject to the Business Corporations Act (British Columbia), we may also by special resolution subdivide or consolidate our shares;





The quorum requirement at meetings of shareholders is at least two persons holding at least five percent (5%) of the outstanding shares must be present in person or represented by proxy in accordance with our Articles.





Our Articles require similar approval of the holders of Preferred Shares in the event of changes analogous to the ones described above to the Preferred Shares. In addition, if the deletion, variation, modification, amendment or amplification of the provisions contained especially affects the rights of the holders of our Preferred Shares of any series, in a manner different from which the rights of the holders of our Preferred Shares of any other series are affected, then amendments must, in addition to being approved by the holders of our Preferred Shares, be approved by the holders of our Preferred Shares of the series especially affected. This approval may be given in writing by the holders of 3/4 of our Preferred Shares of the series or by resolution passed by 3/4 of the votes cast on a poll at the meeting of the holders of our Preferred Shares of the series. At a meeting of the holders of our Preferred Shares as a class or as a series, each holder of our Preferred Shares is entitled to one vote in respect of each Preferred Share held by the holder.





Furthermore, the Business Corporations Act (British Columbia) provides a holder of shares of any class or series of shares, the right to vote separately as a class or series upon amendments to our Constating Documents, which amendments may affect voting rights.





General Meeting




We must hold an ordinary general meeting of our shareholders at least once every calendar year at a time and place determined by our directors and not later than 15 months after the preceding ordinary general meeting, unless extended by the Registrar of Companies upon application made under the Business Corporations Act (British Columbia). Our Chair, President and Chief Executive Officer, Chief Financial Officer or directors may at any time convene a special general meeting, and our directors, upon the requisition of shareholders in accordance with the Business Corporations Act (British Columbia), shall proceed to convene the meeting or meetings to be held at such time and place as the directors determine. The requisition shall state the objects of the meeting requested, be signed by the requisitionists and deposited at our registered office.





At least twenty one days' notice, or any longer period of notice as may be required by the Business Corporations Act (British Columbia), of every general meeting, specifying the place, day and hour of the meeting and, when special business is to be considered, the general nature of such business, must be given to our shareholders entitled to be present at our meeting by notice given as permitted by our Articles. With the consent in writing of all our shareholders entitled to vote at the meeting, a meeting may be convened by a shorter notice and in any manner they think fit, or notice of the time, place and purpose of the meeting may be waived by all of our shareholders. The accidental omission to give notice to a shareholder, or non-receipt of notice by a shareholder, will not invalidate any resolution passed at any general meeting.





No business will be transacted at any general meeting unless the requisite quorum is present at the commencement of the business. Subject to the Business Corporations Act (British Columbia), if we have two or more shareholders, a quorum for the transaction of business at a general meeting shall be two persons present in person, or by proxy and holding or representing by proxy, not less than five percent (5%) of the shares entitled to vote at the general meeting.





Holders of our Common Shares are entitled to attend meetings. However, holders of our Preferred Shares as a class will not be entitled to attend meetings, unless the rights of a particular class provide otherwise. Any of our corporate shareholders that have an authorized agent or representative present at any of the meeting will be deemed to be personally present at the meeting.





Limitations On The Rights To Own Securities




Our Articles do not provide for any limitations on the rights to own our securities. See also “Item 10. “Exchange Controls”.




64








Change In Control Provisions




Our Articles do not contain any change in control limitations with respect to a merger, acquisition or corporate restructuring involving us.





Shareholder Ownership Disclosure




Our Articles do not contain any provision governing the ownership threshold above which shareholder ownership must be disclosed.





Share Rights, Preferences and Restrictions




The following is a summary of the rights and restrictions pertaining to our two classes of shares:





Common Shares




All Common Shares are of the same class and have the same rights, preferences and limitations.




Holders of Common Shares are entitled to one vote per share at any meeting of our shareholders except meetings at which only shareholders of a specified class of shares (other than the Common Shares) are entitled to vote. Subject to the preference of any outstanding Preferred Shares (described below), the holders of Common Shares are entitled to participate equally in any dividends our Board of Directors declares out of funds legally available for the payment of dividends. There are no limitations on the payment of dividends if we are liquidated, dissolved or wound up, holders of Common Shares are entitled to share ratably in all assets remaining after payment of our liabilities and any liquidation preferences of any outstanding Preferred Shares. There are no pre-emptive rights, subscription rights, conversion rights and redemption provisions relating to our Common Shares and none of our Common Shares carry any liability for further calls.





The rights of holders of Common Shares may not be modified other than in accordance with our Articles and the Business Corporations Act(British Columbia) which generally requires the favorable votes of 3⁄4 of the Common Shares voting on such modification. Because a quorum for a general meeting of shareholders can exist with only two shareholders (proxy-holders) personally present, the rights of holders of Common Shares may be modified by less than a majority of the issued Common Shares.




Shareholders may apply to the Supreme Court of British Columbia for various remedies on the ground that our affairs are being conducted in a manner oppressive to one or more of the shareholders or that some resolution of shareholders has been passed or is proposed that is unfairly prejudicial to one or more of the shareholders. That Court may, with a view to bringing it to an end or to remedying the matters complained of, make an interim or final order if it considers appropriate, including the following:




a)
direct or prohibit any act or cancel or vary any transaction or resolution;




b)
regulate the conduct of our affairs in the future;




c)
provide for the purchase of the Common Shares of any shareholder of the Company by another shareholder of the Company, or by us;




d)
in the case of a purchase by us, reduce our capital or otherwise;




e)
appoint a receiver or receiver manager;




f)
order that we be wound up;




65







g)
authorize or direct that proceedings be commenced in our name against any party on the terms the Court directs;




h)
require us to produce financial statements;




i)
order us to compensate an aggrieved person; and




j)
direct rectification of any of our records.




There are no restrictions on the purchase or redemption of Common Shares by us while there is any arrearage in the payment of dividends or sinking fund installments.




Preferred Shares




Our Board of Directors is authorized, without further action by the shareholders, to issue Preferred Shares in one or more series and to set the number of shares constituting any such series and the designation, rights, privileges, restrictions and conditions attaching to the shares of such series including dividend rights and rates, redemption provisions (including sinking fund provisions), rights of conversion or exchange, liquidation preferences and voting rights, if any. The Preferred Shares as a class are entitled to priority over the Common Shares if our Board of Directors decides to pay any dividends, and, if we are dissolved, liquidated or wound up, the Preferred Shares are entitled as a class to priority in respect of return of capital. Except as required by law or the provisions of any designated series of Preferred Shares, the holders of Preferred Shares as a class is not entitled to receive notice of, attend or vote at any meeting of our shareholders.





There were no Preferred Shares allotted or issued as at the date of this Annual Report.





10.C. Material contracts.




The following are the material contracts which we, or any of our subsidiaries, have entered into in the last two years immediately prior to the date of this report:





1.
Our Company Stock Option Plan which received annual approval by our shareholders at our Annual General Meetings on May 29, 2008, May 26, 2009, May 26, 2010, June 7, 2011, and October 1, 2012.




2.
Aravena Option - Under a Unilateral Option Contract dated June 28, 2011 between Cristian Marcelo Aravena Caullan and our subsidiary Minera Samex Chile S. A. (the "Aravena Option"), SAMEX had an option to acquire 100% interest in mineral concessions covering approximately 2,900 hectare adjacent to the Los Zorros property by paying the 2011 patent payments (paid) and by making option payments totaling the Chilean Peso-equivalent of US$245,345 as follows: US$60,000 upon signing the Option (paid); U.S. $95,345 due January 31, 2012 (paid); and US$90,000 by January 31, 2013 (not paid). Subsequent to the year ended December 31, 2012, the Company decided not to exercise the option and advised the owner that it would not be making the final option payment of US$90,000 due January 31, 2013. Dropping the option on these concessions resulted in an impairment of the Aravena Option costs that had previously been capitalized to the Los Zorros Property and consequently option payments and patent costs totaling $201,407 were written off at December 31, 2012.




3.
Employment agreements dated effective October 1, 2011 with each of Jeffrey Dahl, Larry McLean, Brenda McLean and Phil Southam. See Item 6.B “Compensation”;




4.
Consulting agreement dated effective October 1, 2011 with Robert Kell. See Item 6.B “Compensation”;




66







5.
Settlement Agreement dated September 10, 2012 between Sasco Partners, LP and Sasan Sadeghpour, the Company, the Company's former board of directors, Peter J. Dahl, Jeffrey P. Dahl, Robert E. Kell, Larry D. McLean, Allen D. Leschert and Malcolm B. Fraser Brenda McLean and Phil Southam. See Item 7.B. “Related Party Transactions” andItem 5.A. “Operating Results – Settlement Agreement”.




6.
Advisory Agreements dated January 7, 2013 in the form prescribed under the terms of the Settlement Agreement entered into between the Company and each of Jeffrey Dahl, Peter Dahl, Larry McLean, Brenda McLean, Rob Kell, Malcolm Fraser, Allen Leschert and Phil Southam. See Item 7.B. “Related Party Transactions”; Item 5.A. “Operating Results – Settlement Agreement”; Item 6.B. Compensation "Stock Options"; and Item 7.B. "Related Party Transactions".




7.
Consulting agreement dated effective January 16, 2013 between the Company and Larry McLean. See Item 7.B. “Related Party Transactions” and Item 5.A. “Operating Results – Settlement Agreement”.




8.
Consulting agreement dated effective January 16, 2013 between the Company and Brenda McLean. See Item 7.B. “Related Party Transactions” and Item 5.A. “Operating Results – Settlement Agreement”.




9.
Consulting & Confidentiality Agreement dated January 16, 2013 between Minera Samex Chile S.A. and Toro Taylor Y Compañia Limitada. See Item 5.A. “Operating Results -Agreement with Toro Taylor”.





10.D. Exchange controls.




There are no governmental laws, decrees or regulations in Canada that restrict the export or import of capital (including, without limitation, foreign exchange controls), or that affect the remittance of dividends, interest or other payments to non-resident holders of our Common Shares. However, any such remittance to a resident of the United States may be subject to a withholding tax pursuant to the reciprocal tax treaty between Canada and the United States. For further information concerning such withholding tax, see “Item 10.E. Taxation.”





There are no limitations under the laws of Canada, the Province of British Columbia, or in our charter or other constituent documents with respect to the right of non-resident or foreign owners to hold and/or vote our common shares. However, the Investment Canada Act (the “Act”), enacted on June 20, 1985, as amended, requires the prior notification and, in certain cases, advance review and approval by the Government of Canada of the acquisition by a “non-Canadian” of “control” of a “Canadian business,” all as defined in the Act. For the purposes of the Act, “control” can be acquired through the acquisition of all or substantially all of the assets used in the Canadian business, or the direct or indirect acquisition of interests in an entity that carries on a Canadian business or which controls the entity which carries on the Canadian business. Under the Act, control of a corporation is deemed to be acquired through the acquisition of a majority of the voting shares of a corporation, and is presumed to be acquired where more than one-third, but less than a majority, of the voting shares of a corporation are acquired, unless it can be established that the corporation is not controlled in fact through the ownership of voting shares. Other rules apply with respect to the acquisition of non-corporate entities.




Investments requiring review and approval include direct acquisition of Canadian businesses with assets with a gross book value of $5,000,000 or more; indirect acquisitions of Canadian businesses with assets of $50,000,000 or more; and indirect acquisitions of Canadian businesses where the value of assets of the entity or entities carrying on business in Canada, control of which is indirectly being acquired, is greater than $5,000,000 and represents greater than 50% of the total value of the assets of all of the entities, control of which is being acquired.




Pursuant to the World Trade Organization Agreement Implementation Act, the Act was amended to provide that the value of the business acquisition threshold (the “Threshold”) above described is increased from those levels outlined where the acquisition is by a World Trade Organization Investor or by a non-Canadian other than a World Trade Organization Investor where the Canadian business that is the subject of the investment is immediately before the investment controlled by a World Trade Organization Investor. The Threshold is to be determined yearly in accordance with a formula set forth in the Act. For 2012, the Threshold was determined to be CDN $330,000,000 (CDN $334,000,000 for 2013).




67







A World Trade Organization Investor includes an individual, other than a Canadian, who is a national of a World Trade Organization Member, or who has the right of permanent residence in relation to that World Trade Organization Member.




Different provisions and considerations apply with respect to investment to acquire control of a Canadian business that, as defined in the Act or regulations:




a)
engages in production of uranium and owns an interest in a producing uranium property in Canada;




b)
provides financial services;




c)
provides transportation services;




d)
is a cultural business.




If an investment is reviewable, an application for review in the form prescribed by regulation is normally required to be filed with the Ministry of Industry, Director of Investment prior to the investment taking place and the investment may not be consummated until the review has been completed and ministerial approval obtained. Applications for review concerning indirect acquisitions may be filed up to 30 days after the investment is consummated. Applications concerning reviewable investments in culturally sensitive and other specified activities referred to in the preceding paragraph are required upon receipt of a notice for review. There is, moreover, provision for the Minister (a person designated as such under the Act) to permit an investment to be consummated prior to completion of review if he is satisfied that delay would cause undue hardship to the acquirer or jeopardize the operation of the Canadian business that is being acquired.




10.E. Taxation.




Certain United States Federal Income Tax Considerations




The following is a general summary of certain material U.S. federal income tax considerations applicable to a U.S. Holder (as defined below) arising from and relating to the acquisition, ownership, and disposition of Common Shares.





This summary is for general information purposes only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may apply to a U.S. Holder arising from and relating to the acquisition, ownership, and disposition of Common Shares. In addition, this summary does not take into account the individual facts and circumstances of any particular U.S. Holder that may affect the U.S. federal income tax consequences to such U.S. Holder,including specific tax consequences to a U.S. Holder under an applicable tax treaty. Accordingly, this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any U.S. Holder. This summary does not address the U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and local, and foreign tax consequences to U.S. Holders of the acquisition, ownership, and disposition of Common Shares. In addition, except as specifically set forth below, this summary does not discuss applicable tax reporting requirements. Each prospective U.S. Holder should consult its own tax advisors regarding the U.S. federal, U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and local, and foreign tax consequences relating to the acquisition, ownership and disposition of Common Shares.





No legal opinion from U.S. legal counsel or ruling from the Internal Revenue Service (the “IRS”) has been requested, or will be obtained, regarding the U.S. federal income tax consequences of the acquisition, ownership, and disposition of Common Shares. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, the positions taken in this summary. In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the conclusions described in this summary.




68








Scope of this Summary




Authorities





This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations (whether final, temporary, or proposed), published rulings of the IRS, published administrative positions of the IRS, the Convention Between Canada and the United States of America with Respect to Taxes on Income and on Capital, signed September 26, 1980, as amended (the “Canada-U.S. Tax Convention”), and U.S. court decisions that are applicable and, in each case, as in effect and available, as of the date of this document. Any of the authorities on which this summary is based could be changed in a material and adverse manner at any time, and any such change could be applied on a retroactive or prospective basis which could affect the U.S. federal income tax considerations described in this summary. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation.





U.S. Holders





For purposes of this summary, the term "U.S. Holder" means a beneficial owner of Common Shares that is for U.S. federal income tax purposes:





·
an individual who is a citizen or resident of the U.S.;




·
a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) organized under the laws of the U.S., any state thereof or the District of Columbia;




·
an estate whose income is subject to U.S. federal income taxation regardless of its source; or




·
a trust that (1) is subject to the primary supervision of a court within the U.S. and the control of one or more U.S. persons for all substantial decisions or (2) has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.




U.S. Holders Subject to Special U.S. Federal Income Tax Rules Not Addressed





This summary does not address the U.S. federal income tax considerations applicable to U.S. Holders that are subject to special provisions under the Code, including, but not limited to, the following U.S. Holders that: (a) are tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; (b) are financial institutions, underwriters, insurance companies, real estate investment trusts, or regulated investment companies; (c) are broker-dealers, dealers, or traders in securities or currencies that elect to apply a mark-to-market accounting method; (d) have a “functional currency” other than the U.S. dollar; (e) own Common Shares as part of a straddle, hedging transaction, conversion transaction, constructive sale, or other arrangement involving more than one position; (f) acquired Common Shares in connection with the exercise of employee stock options or otherwise as compensation for services; (g) hold Common Shares other than as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment purposes); or (h) own or have owned (directly, indirectly, or by attribution) 10% or more of the total combined voting power of the outstanding shares of the Company. This summary also does not address the U.S. federal income tax considerations applicable to U.S. Holders who are: (a) U.S. expatriates or former long-term residents of the U.S.; (b) persons that have been, are, or will be a resident or deemed to be a resident in Canada for purposes of the Income Tax Act (Canada) (the “Tax Act”); (c) persons that use or hold, will use or hold, or that are or will be deemed to use or hold Common Shares in connection with carrying on a business in Canada; (d) persons whose Common Shares constitute “taxable Canadian property” under the Tax Act; or (e) persons that have a permanent establishment in Canada for the purposes of the Canada-U.S. Tax Convention. U.S. Holders that are subject to special provisions under the Code, including, but not limited to, U.S. Holders described immediately above, should consult their own tax advisors regarding the U.S. federal, U.S. federal alternative minimum, U.S. federal estate and gift, U.S. state and local, and foreign tax consequences relating to the acquisition, ownership and disposition of Common Shares.




69








If an entity or arrangement that is classified as a partnership (or other “pass-through” entity) for U.S. federal income tax purposes holds Common Shares, the U.S. federal income tax consequences to such entity and the partners (or other owners) of such entity generally will depend on the activities of the entity and the status of such partners (or owners). This summary does not address the tax consequences to any such entity or owner. Partners (or other owners) of entities or arrangements that are classified as partnerships or as “pass-through” entities for U.S. federal income tax purposes should consult their own tax advisors regarding the U.S. federal income tax consequences arising from and relating to the acquisition, ownership, and disposition of Common Shares.





Passive Foreign Investment Company Rules





PFIC Status of the Company





If the Company were to constitute a “passive foreign investment company” under the meaning of Section 1297 of the Code (a “PFIC”, as defined below) for any year during a U.S. Holder’s holding period, then certain potentially adverse rules will affect the U.S. federal income tax consequences to a U.S. Holder resulting from the acquisition, ownership and disposition of Common Shares. The Company believes that it was classified as a PFIC during the tax year ended December 31, 2012, and based on current business plans and financial expectations, the Company expects that it will be a PFIC for the current tax year and may be a PFIC in future tax years. The determination of whether any corporation was, or will be, a PFIC for a tax year depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations. In addition, whether any corporation will be a PFIC for any tax year depends on the assets and income of such corporation over the course of each such tax year and, as a result, cannot be predicted with certainty as of the date of this document. Accordingly, there can be no assurance that the IRS will not challenge any determination made by the Company (or any subsidiary of the Company) concerning its PFIC status. Each U.S. Holder should consult its own tax advisors regarding the PFIC status of the Company and any subsidiary of the Company.





In any year in which the Company is classified as a PFIC, a U.S. Holder may be required to file an annual report with the IRS containing such information as Treasury Regulations and/or other IRS guidance may require. U.S. Holders should consult their own tax advisors regarding the requirements of filing such information returns under these rules, including the requirement to file an IRS Form 8621.





The Company generally will be a PFIC if, for a tax year, (a) 75% or more of the gross income of the Company is passive income (the “income test”) or (b) 50% or more of the value of the Company’s assets either produce passive income or are held for the production of passive income, based on the quarterly average of the fair market value of such assets (the “asset test”). “Gross income” generally includes all sales revenues less the cost of goods sold, plus income from investments and from incidental or outside operations or sources, and “passive income” generally includes, for example, dividends, interest, certain rents and royalties, certain gains from the sale of stock and securities, and certain gains from commodities transactions.





Active business gains arising from the sale of commodities generally are excluded from passive income if substantially all (85% or more) of a foreign corporation’s commodities are stock in trade or inventory, depreciable property used in a trade or business, or supplies regularly used or consumed in the ordinary course of its trade or business, and certain other requirements are satisfied.





For purposes of the PFIC income test and asset test described above, if the Company owns, directly or indirectly, 25% or more of the total value of the outstanding shares of another corporation, the Company will be treated as if it (a) held a proportionate share of the assets of such other corporation and (b) received directly a proportionate share of the income of such other corporation. In addition, for purposes of the PFIC income test and asset test described above, and assuming certain other requirements are met, “passive income” does not include certain interest, dividends, rents, or royalties that are received or accrued by the Company from certain “related persons” (as defined in Section 954(d)(3) of the Code), to the extent such items are properly allocable to the income of such related person that is not passive income.





Under certain attribution rules, if the Company is a PFIC, U.S. Holders will generally be deemed to own their proportionate share of the Company’s direct or indirect equity interest in any company that is also a PFIC (a ‘‘Subsidiary PFIC’’), and will be subject to U.S. federal income tax on their proportionate share of (a) any “excess distributions,” as described below, on the stock of a Subsidiary PFIC and (b) a disposition or deemed disposition of the stock of a Subsidiary PFIC by the Company or another Subsidiary PFIC, both as if such U.S. Holders directly held the shares of such Subsidiary PFIC. In addition, U.S. Holders may be subject to U.S. federal income tax on any indirect gain realized on the stock of a Subsidiary PFIC on the sale or disposition of Common Shares. Accordingly, U.S. Holders should be aware that they could be subject to tax even if no distributions are received and no redemptions or other dispositions of Common Shares are made.




70









Default PFIC Rules Under Section 1291 of the Code




If the Company is a PFIC for any tax year during which a U.S. Holder owns Common Shares, the U.S. federal income tax consequences to such U.S. Holder of the acquisition, ownership, and disposition of Common Shares will depend on whether and when such U.S. Holder makes an election to treat the Company and each Subsidiary PFIC, if any, as a “qualified electing fund” or “QEF” under Section 1295 of the Code (a “QEF Election”) or makes a mark-to-market election under Section 1296 of the Code (a “Mark-to-Market Election”). A U.S. Holder that does not make either a QEF Election or a Mark-to-Market Election will be referred to in this summary as a “Non-Electing U.S. Holder.”





A Non-Electing U.S. Holder will be subject to the rules of Section 1291 of the Code (described below) with respect to (a) any gain recognized on the sale or other taxable disposition of Common Shares and (b) any “excess distribution” received on the Common Shares. A distribution generally will be an “excess distribution” to the extent that such distribution (together with all other distributions received in the current tax year) exceeds 125% of the average distributions received during the three preceding tax years (or during a U.S. Holder’s holding period for the Common Shares, if shorter).





Under Section 1291 of the Code, any gain recognized on the sale or other taxable disposition of Common Shares (including an indirect disposition of the stock of any Subsidiary PFIC), and any “excess distribution” received on Common Shares or with respect to the stock of a Subsidiary PFIC, must be ratably allocated to each day in a Non-Electing U.S. Holder’s holding period for the respective Common Shares. The amount of any such gain or excess distribution allocated to the tax year of disposition or distribution of the excess distribution and to years before the entity became a PFIC, if any, would be taxed as ordinary income. The amounts allocated to any other tax year would be subject to U.S. federal income tax at the highest tax rate applicable to ordinary income in each such year, and an interest charge would be imposed on the tax liability for each such year, calculated as if such tax liability had been due in each such year. A Non-Electing U.S. Holder that is not a corporation must treat any such interest paid as “personal interest,” which is not deductible.





If the Company is a PFIC for any tax year during which a Non-Electing U.S. Holder holds Common Shares, the Company will continue to be treated as a PFIC with respect to such Non-Electing U.S. Holder, regardless of whether the Company ceases to be a PFIC in one or more subsequent tax years. A Non-Electing U.S. Holder may terminate this deemed PFIC status by electing to recognize gain (which will be taxed under the rules of Section 1291 of the Code discussed above), but not loss, as if such Common Shares were sold on the last day of the last tax year for which the Company was a PFIC.





QEF Election




A U.S. Holder that makes a timely and effective QEF Election for the first tax year in which the holding period of its Common Shares begins generally will not be subject to the rules of Section 1291 of the Code discussed above with respect to its Common Shares. A U.S. Holder that makes a timely and effective QEF Election will be subject to U.S. federal income tax on such U.S. Holder’s pro rata share of (a) the net capital gain of the Company, which will be taxed as long-term capital gain to such U.S. Holder, and (b) the ordinary earnings of the Company, which will be taxed as ordinary income to such U.S. Holder. Generally, “net capital gain” is the excess of (a) net long-term capital gain over (b) net short-term capital loss, and “ordinary earnings” are the excess of (a) “earnings and profits” over (b) net capital gain. A U.S. Holder that makes a QEF Election will be subject to U.S. federal income tax on such amounts for each tax year in which the Company is a PFIC, regardless of whether such amounts are actually distributed to such U.S. Holder by the Company. However, for any tax year in which the Company is a PFIC and has no net income or gain, U.S. Holders that have made a QEF Election would not have any income inclusions as a result of the QEF Election. If a U.S. Holder that made a QEF Election has an income inclusion, such a U.S. Holder may, subject to certain limitations, elect to defer payment of current U.S. federal income tax on such amounts, subject to an interest charge. If such U.S. Holder is not a corporation, any such interest paid will be treated as “personal interest,” which is not deductible.




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A U.S. Holder that makes a timely and effective QEF Election with respect to the Company generally (a) may receive a tax-free distribution from the Company to the extent that such distribution represents “earnings and profits” of the Company that were previously included in income by the U.S. Holder because of such QEF Election and (b) will adjust such U.S. Holder’s tax basis in the Common Shares to reflect the amount included in income or allowed as a tax-free distribution because of such QEF Election. In addition, a U.S. Holder that makes a QEF Election generally will recognize capital gain or loss on the sale or other taxable disposition of Common Shares.




The procedure for making a QEF Election, and the U.S. federal income tax consequences of making a QEF Election, will depend on whether such QEF Election is timely. A QEF Election will be treated as “timely” if such QEF Election is made for the first year in the U.S. Holder’s holding period for the Common Shares in which the Company was a PFIC. A U.S. Holder may make a timely QEF Election by filing the appropriate QEF Election documents at the time such U.S. Holder files a U.S. federal income tax return for such year. If a U.S. Holder does not make a timely and effective QEF Election for the first year in the U.S. Holder’s holding period for the Common Shares, the U.S. Holder may still be able to make a timely and effective QEF Election in a subsequent year if such U.S. Holder meets certain requirements and makes a “purging” election to recognize gain (which will be taxed under the rules of Section 1291 of the Code discussed above) as if such Common Shares were sold for their fair market value on the day the QEF Election is effective. If a U.S. Holder owns PFIC stock indirectly through another PFIC, separate QEF Elections must be made for the PFIC in which the U.S. Holder is a direct shareholder and the Subsidiary PFIC for the QEF rules to apply to both PFICs.




A QEF Election will apply to the tax year for which such QEF Election is timely made and to all subsequent tax years, unless such QEF Election is invalidated or terminated or the IRS consents to revocation of such QEF Election. If a U.S. Holder makes a QEF Election and, in a subsequent tax year, the Company ceases to be a PFIC, the QEF Election will remain in effect (although it will not be applicable) during those tax years in which the Company is not a PFIC. Accordingly, if the Company becomes a PFIC in another subsequent tax year, the QEF Election will be effective and the U.S. Holder will be subject to the QEF rules described above during any subsequent tax year in which the Company qualifies as a PFIC.




U.S. Holders should be aware that there can be no assurances that the Company will satisfy the record keeping requirements that apply to a QEF, or that the Company will supply U.S. Holders with information that such U.S. Holders are required to report under the QEF rules, in the event that the Company is a PFIC. Thus, U.S. Holders may not be able to make a QEF Election with respect to their Common Shares. Each U.S. Holder should consult its own tax advisors regarding the availability of, and procedure for making, a QEF Election.




A U.S. Holder makes a QEF Election by attaching a completed IRS Form 8621, including a PFIC Annual Information Statement, to a timely filed United States federal income tax return. However, if the Company does not provide the required information with regard to the Company or any of its Subsidiary PFICs, U.S. Holders will not be able to make a QEF Election for such entity and will continue to be subject to the rules discussed above that apply to Non-Electing U.S. Holders with respect to the taxation of gains and excess distributions.




Mark-to-Market Election




A U.S. Holder may make a Mark-to-Market Election only if the Common Shares are marketable stock. The Common Shares generally will be “marketable stock” if the Common Shares are regularly traded on (a) a national securities exchange that is registered with the Securities and Exchange Commission, (b) the national market system established pursuant to section 11A of the Securities and Exchange Act of 1934, or (c) a foreign securities exchange that is regulated or supervised by a governmental authority of the country in which the market is located, provided that (i) such foreign exchange has trading volume, listing, financial disclosure, and surveillance requirements, and meets other requirements and the laws of the country in which such foreign exchange is located, together with the rules of such foreign exchange, ensure that such requirements are actually enforced and (ii) the rules of such foreign exchange effectively promote active trading of listed stocks. If such stock is traded on such a qualified exchange or other market, such stock generally will be “regularly traded” for any calendar year during which such stock is traded, other than in de minimis quantities, on at least 15 days during each calendar quarter.




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A U.S. Holder that makes a Mark-to-Market Election with respect to its Common Shares generally will not be subject to the rules of Section 1291 of the Code discussed above with respect to such Common Shares. However, if a U.S. Holder does not make a Mark-to-Market Election beginning in the first tax year of such U.S. Holder’s holding period for the Common Shares or such U.S. Holder has not made a timely QEF Election, the rules of Section 1291 of the Code discussed above will apply to certain dispositions of, and distributions on, the Common Shares.




A U.S. Holder that makes a Mark-to-Market Election will include in ordinary income, for each tax year in which the Company is a PFIC, an amount equal to the excess, if any, of (a) the fair market value of the Common Shares, as of the close of such tax year over (b) such U.S. Holder’s adjusted tax basis in such Common Shares. A U.S. Holder that makes a Mark-to-Market Election will be allowed a deduction in an amount equal to the excess, if any, of (a) such U.S. Holder’s adjusted tax basis in the Common Shares, over (b) the fair market value of such Common Shares (but only to the extent of the net amount of previously included income as a result of the Mark-to-Market Election for prior tax years).




A U.S. Holder that makes a Mark-to-Market Election generally also will adjust such U.S. Holder’s tax basis in the Common Shares to reflect the amount included in gross income or allowed as a deduction because of such Mark-to-Market Election. In addition, upon a sale or other taxable disposition of Common Shares, a U.S. Holder that makes a Mark-to-Market Election will recognize ordinary income or ordinary loss (not to exceed the excess, if any, of (a) the amount included in ordinary income because of such Mark-to-Market Election for prior tax years over (b) the amount allowed as a deduction because of such Mark-to-Market Election for prior tax years). Losses that exceed this limitation are subject to the rules generally applicable to losses provided in the Code and Treasury Regulations.




A Mark-to-Market Election applies to the tax year in which such Mark-to-Market Election is made and to each subsequent tax year, unless the Common Shares cease to be “marketable stock” or the IRS consents to revocation of such election. Each U.S. Holder should consult its own tax advisors regarding the availability of, and procedure for making, a Mark-to-Market Election.




Although a U.S. Holder may be eligible to make a Mark-to-Market Election with respect to the Common Shares, no such election may be made with respect to the stock of any Subsidiary PFIC that a U.S. Holder is treated as owning, because such stock is not marketable. Hence, the Mark-to-Market Election will not be effective to avoid the application of the default rules of Section 1291 of the Code described above with respect to deemed dispositions of Subsidiary PFIC stock or excess distributions from a Subsidiary PFIC.




Other PFIC Rules




Under Section 1291(f) of the Code, the IRS has issued proposed Treasury Regulations that, subject to certain exceptions, would cause a U.S. Holder that had not made a timely QEF Election to recognize gain (but not loss) upon certain transfers of Common Shares that would otherwise be tax-deferred (e.g., gifts and exchanges pursuant to corporate reorganizations). However, the specific U.S. federal income tax consequences to a U.S. Holder may vary based on the manner in which Common Shares are transferred.




Certain additional adverse rules may apply with respect to a U.S. Holder if the Company is a PFIC, regardless of whether such U.S. Holder makes a QEF Election. For example, under Section 1298(b)(6) of the Code, a U.S. Holder that uses Common Shares as security for a loan will, except as may be provided in Treasury Regulations, be treated as having made a taxable disposition of such Common Shares.




Special rules also apply to the amount of foreign tax credit that a U.S. Holder may claim on a distribution from a PFIC. Subject to such special rules, foreign taxes paid with respect to any distribution in respect of stock in a PFIC are generally eligible for the foreign tax credit. The rules relating to distributions by a PFIC and their eligibility for the foreign tax credit are complicated, and a U.S. Holder should consult with its own tax advisors regarding the availability of the foreign tax credit with respect to distributions by a PFIC.




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The PFIC rules are complex, and each U.S. Holder should consult its own tax advisors regarding the PFIC rules and how the PFIC rules may affect the U.S. federal income tax consequences of the acquisition, ownership, and disposition of Common Shares.




Ownership and Disposition of Common Shares




The following discussion is subject to the rules described above under the heading “Passive Foreign Investment Company Rules.”




Distributions on Common Shares





A U.S. Holder that receives a distribution, including a constructive distribution, with respect to a Common Share will be required to include the amount of such distribution in gross income as a dividend (without reduction for any Canadian income tax withheld from such distribution) to the extent of the current or accumulated “earnings and profits” of the Company, as computed for U.S. federal income tax purposes. A dividend generally will be taxed to a U.S. Holder at ordinary income tax rates if the Company is a PFIC. To the extent that a distribution exceeds the current and accumulated “earnings and profits” of the Company, such distribution will be treated first as a tax-free return of capital to the extent of a U.S. Holder's tax basis in the Common Shares and thereafter as gain from the sale or exchange of such Common Shares. (See “Sale or Other Taxable Disposition of Common Shares” below). However, the Company may not maintain the calculations of its earnings and profits in accordance with U.S. federal income tax principles, and each U.S. Holder may have to assume that any distribution by the Company with respect to the Common Shares will constitute ordinary dividend income. Dividends received on Common Shares by corporate U.S. Holders generally will not be eligible for the “dividends received deduction.” Subject to applicable limitations and provided the Company is eligible for the benefits of the Canada-U.S. Tax Convention, dividends paid by the Company to non-corporate U.S. Holders, including individuals, generally will be eligible for the preferential tax rates applicable to long-term capital gains for dividends, provided certain holding period and other conditions are satisfied, including that the Company not be classified as a PFIC in the tax year of distribution or in the preceding tax year. The dividend rules are complex, and each U.S. Holder should consult its own tax advisors regarding the application of such rules.





Sale or Other Taxable Disposition of Common Shares





Upon the sale or other taxable disposition of Common Shares, a U.S. Holder generally will recognize capital gain or loss in an amount equal to the difference between the U.S. dollar value of cash received plus the fair market value of any property received and such U.S. Holder's tax basis in such Common Shares sold or otherwise disposed of. A U.S. Holder’s tax basis in Common Shares generally will be such holder’s U.S. dollar cost for such Common Shares. Gain or loss recognized on such sale or other disposition generally will be long-term capital gain or loss if, at the time of the sale or other disposition, the Common Shares have been held for more than one year.





Preferential tax rates currently apply to long-term capital gain of a U.S. Holder that is an individual, estate, or trust. There are currently no preferential tax rates for long-term capital gain of a U.S. Holder that is a corporation. Deductions for capital losses are subject to significant limitations under the Code.





Additional Considerations





Additional Tax on Passive Income





Individuals, estates and certain trusts whose income exceeds certain thresholds will be required to pay a 3.8% Medicare surtax on “net investment income” including, among other things, dividends and net gain from dispositions of property (other than property held in certain trades or businesses). U.S. Holders should consult with their own tax advisors regarding the effect, if any, of this tax on their ownership and disposition of Common Shares.




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Receipt of Foreign Currency





The amount of any distribution paid to a U.S. Holder in foreign currency, or on the sale, exchange or other taxable disposition of Common Shares, generally will be equal to the U.S. dollar value of such foreign currency based on the exchange rate applicable on the date of receipt (regardless of whether such foreign currency is converted into U.S. dollars at that time). A U.S. Holder will have a basis in the foreign currency equal to its U.S. dollar value on the date of receipt. Any U.S. Holder who converts or otherwise disposes of the foreign currency after the date of receipt may have a foreign currency exchange gain or loss that would be treated as ordinary income or loss, and generally will be U.S. source income or loss for foreign tax credit purposes. Each U.S. Holder should consult its own U.S. tax advisors regarding the U.S. federal income tax consequences of receiving, owning, and disposing of foreign currency.





Foreign Tax Credit





Subject to the PFIC rules discussed above, a U.S. Holder that pays (whether directly or through withholding) Canadian income tax with respect to dividends paid on the Common Shares generally will be entitled, at the election of such U.S. Holder, to receive either a deduction or a credit for such Canadian income tax. Generally, a credit will reduce a U.S. Holder’s U.S. federal income tax liability on a dollar-for-dollar basis, whereas a deduction will reduce a U.S. Holder’s income subject to U.S. federal income tax. This election is made on a year-by-year basis and applies to all foreign taxes paid (whether directly or through withholding) by a U.S. Holder during a year.





Complex limitations apply to the foreign tax credit, including the general limitation that the credit cannot exceed the proportionate share of a U.S. Holder’s U.S. federal income tax liability that such U.S. Holder’s “foreign source” taxable income bears to such U.S. Holder’s worldwide taxable income. In applying this limitation, a U.S. Holder’s various items of income and deduction must be classified, under complex rules, as either “foreign source” or “U.S. source.” Generally, dividends paid by a foreign corporation should be treated as foreign source for this purpose, and gains recognized on the sale of stock of a foreign corporation by a U.S. Holder should be treated as U.S. source for this purpose, except as otherwise provided in an applicable income tax treaty, and if an election is properly made under the Code. However, the amount of a distribution with respect to the Common Shares that is treated as a “dividend” may be lower for U.S. federal income tax purposes than it is for Canadian federal income tax purposes, resulting in a reduced foreign tax credit allowance to a U.S. Holder. In addition, this limitation is calculated separately with respect to specific categories of income. The foreign tax credit rules are complex, and each U.S. Holder should consult its own U.S. tax advisors regarding the foreign tax credit rules.





Backup Withholding and Information Reporting




Under U.S. federal income tax law and Treasury Regulations, certain categories of U.S. Holders must file information returns with respect to their investment in, or involvement in, a foreign corporation. For example, U.S. return disclosure obligations (and related penalties) are imposed on individuals who are U.S. Holders that hold certain specified foreign financial assets in excess of certain thresholds. The definition of specified foreign financial assets includes not only financial accounts maintained in foreign financial institutions, but also, unless held in accounts maintained by a financial institution, any stock or security issued by a non-U.S. person, any financial instrument or contract held for investment that has an issuer or counterparty other than a U.S. person and any interest in a foreign entity. U.S. Holders may be subject to these reporting requirements unless their Common Shares are held in an account at certain financial institutions. Penalties for failure to file certain of these information returns are substantial. U.S. Holders should consult with their own tax advisors regarding the requirements of filing information returns, including the requirement to file an IRS Form 8938.





Payments made within the U.S. or by a U.S. payor or U.S. middleman, of dividends on, and proceeds arising from the sale or other taxable disposition of, Common Shares will generally be subject to information reporting and backup withholding tax, at the rate of 28%, if a U.S. Holder (a) fails to furnish such U.S. Holder’s correct U.S. taxpayer identification number (generally on Form W-9), (b) furnishes an incorrect U.S. taxpayer identification number, (c) is notified by the IRS that such U.S. Holder has previously failed to properly report items subject to backup withholding tax, or (d) fails to certify, under penalty of perjury, that such U.S. Holder has furnished its correct U.S. taxpayer identification number and that the IRS has not notified such U.S. Holder that it is subject to backup withholding tax. However, certain exempt persons generally are excluded from these information reporting and backup withholding rules. Backup withholding is not an additional tax. Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a credit against a U.S. Holder’s U.S. federal income tax liability, if any, or will be refunded, if such U.S. Holder furnishes required information to the IRS in a timely manner.




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The discussion of reporting requirements set forth above is not intended to constitute a complete description of all reporting requirements that may apply to a U.S. Holder. A failure to satisfy certain reporting requirements may result in an extension of the time period during which the IRS can assess a tax, and under certain circumstances, such an extension may apply to assessments of amounts unrelated to any unsatisfied reporting requirement. Each U.S. Holder should consult its own tax advisors regarding the information reporting and backup withholding rules.





Certain Canadian Federal Income Tax Consequences




The following discussion summarizes the principal Canadian federal income tax considerations generally applicable to a person who owns one or more common shares of the Company (the "Shareholder"), and who at all material times for the purposes of the Income Tax Act (Canada) (the "Canadian Act") deals at arm's length with the Company, holds all common shares solely as capital property, is a non-resident of Canada, and does not, and is not deemed to, use or hold any Common share in or in the course of carrying on business in Canada. It is assumed that the common shares will at all material times be listed on a stock exchange that is designated for the purposes of the Canadian Act.





This summary is based on the current provisions of the Canadian Act, including the regulations thereunder, and the Canada-United States Income Tax Convention (1980) (the "Treaty") as amended. This summary takes into account all specific proposals to amend the Canadian Act and the regulations thereunder publicly announced by the government of Canada to the date hereof and the Company's understanding of the current published administrative and assessing practices of the Canada Revenue Agency. It is assumed that all such amendments will be enacted substantially as currently proposed, and that there will be no other material change to any such law or practice, although no assurances can be given in these respects. Except to the extent otherwise expressly set out herein, this summary does not take into account any provincial, territorial or foreign income tax law or treaty.





This summary is not, and is not to be construed as, tax advice to any particular Shareholder. Each prospective and current Shareholder is urged to obtain independent advice as to the Canadian income tax consequences of an investment in common shares applicable to the Shareholder's particular circumstances.





A Shareholder generally will not be subject to tax pursuant to the Canadian Act on any capital gain realized by the Shareholder on a disposition of a Common share unless the Common share constitutes "taxable Canadian property" to the Shareholder for purposes of the Canadian Act and the Shareholder is not eligible for relief pursuant to an applicable bilateral tax treaty. A Common share that is disposed of by a Shareholder will constitute taxable Canadian property of the Shareholder and will thus be subject to Canadian tax, if the Shareholder alone or together with one or more persons with whom the Shareholder did not deal at arm's length owned, or owned any right to acquire, 25% or more of the issued shares of any class of the capital stock of the Company in the five years immediately preceding the disposition. However, the Treaty will generally exempt a Shareholder who would otherwise be liable to pay Canadian income tax in respect of any capital gain realized by the Shareholder on the disposition of a Common Share that is Taxable Canadian Property, who is a resident of the United States for the purposes of the Treaty and who is not excluded from the benefits of the Treaty because of the application of the Limitation of Benefits provision in the Treaty, from such liability provided that the value of the Common share is not derived principally from real property (including resource property) situated in Canada or that the Shareholder does not have, and has not had within the 12-month period preceding the disposition, a "permanent establishment" or "fixed base," as those terms are defined for the purposes of the Treaty, available to the Shareholder in Canada.




Any dividend on a Common share, including a stock dividend, paid or credited, or deemed to be paid or credited, by the Company to a Shareholder will be subject to Canadian withholding tax at the rate of 25% on the gross amount of the dividend, or such lesser rate as may be available under an applicable income tax treaty. Pursuant to the Treaty, the rate of withholding tax applicable to a dividend paid on a Common share to a Shareholder who is a resident of the United States for the purposes of the Treaty will be reduced to 5% if the beneficial owner of the dividend is a company that owns at least 10% of the voting stock of the Company, and in any other case will be reduced to 15%, of the gross amount of the dividend. The Company will be required to withhold any such tax from the dividend, and remit the tax directly to Canada Revenue Agency on behalf of the Shareholder.




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The Fifth Protocol to the Treaty signed in 2007 between Canada and the US extended, in some cases, the benefits of the Treaty to US shareholders who are otherwise resident in the United States and who are considered to derive income or gain in respect of a Common share through a fiscally transparent entity (other than a Canadian resident entity) under US tax law. Consequently, such persons may be entitled to the benefits of the Treaty to reduce Canadian taxes in respect of dividends or gains on Common shares.




ALL PROSPECTIVE INVESTORS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES OF PURCHASING THE COMMON SHARES.




10.F. Dividends and Paying Agents.





Not Applicable.





10.G. Statement by Experts.




Not Applicable.





10.H. Documents on Display.




We have filed with the Securities and Exchange Commission this Annual Report on Form 20-F, including exhibits, under the Exchange Act.





We are subject to the informational requirements of the Exchange Act and file reports and other information with the Securities and Exchange Commission. Reports and other information which we file with the Securities and Exchange Commission, including this Annual Report on Form 20-F, may be inspected and copied at the public reference facilities of the Securities and Exchange Commission at:




100 F Street, NE


Washington D.C. 20549




You can also obtain copies of this material by mail from the Public Reference Section of the Securities and Exchange Commission, 100 F Street, NE, Washington, D.C. 20549, at prescribed rates. Additionally, copies of this material may also be obtained from the Securities and Exchange Commission's internet site at http://www.sec.gov. The Commission's telephone number is 1-800-SEC-0330.





Copies of the above material contracts may be inspected at the offices of Leschert & Company Law Corporation, #2760 – 200 Granville Street, Vancouver, British Columbia, Canada, during normal business hours.





10.I. Subsidiary Information.




As of April 26, 2013we have the following subsidiaries:




a)
Minera Samex Chile S. A. (Chile)




b)
South American Mining & Exploration Corp. (British Columbia, Canada) - inactive




c)
SAMEX International Ltd. (Bahamas)- inactive




d)
Minas Bolivex S.A. (“Bolivex S.A.”) (Bolivia) - inactive




e)
SAMEX S.A. (Bolivia) - inactive




f)
Empresa Minera Boliviana S. A. (“Emibol S.A.”) (Bolivia) - inactive




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Subsequent to the fiscal period ending December 31, 2012, we decided to cease operations in Bolivia and are currently in the process of winding up or disposing of our interests in all of the above subsidiaries other than Minera Samex Chile S.A. See Item 4.B. "Wind-up Of Bolivian Subsidiaries".





Item 11. Quantitative And Qualitative Disclosures About Market Risk.




We were incorporated under the laws of British Columbia, Canada and our financial results are quantified in Canadian dollars. We raise equity funding through the sale of securities denominated in Canadian dollars, whereas the majority of our obligations and expenditures with respect to our properties will be incurred in Chilean Pesos. Variations in the exchange rate may give rise to foreign exchange gains or losses that may be significant. Market risks relating to our operations, if we begin production, are anticipated to result primarily from changes in interest rates, foreign exchange rates and commodity prices, as well as credit risk concentrations. We do not use financial instruments for trading purposes and are not parties to any leverage derivatives. We do not currently engage in hedging transactions. See “Currency and Exchange Rates” and Item 4 – “Information on the Company”.





Item 12. Description Of Securities Other Than Equity Securities.




12.A.-C.




Not Applicable.




12.D. American Depository Receipts




The Company's Common Shares are not represented by American Depository Receipts.




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PART II




Item 13. Defaults, Dividend Arrearages And Delinquencies.




Not Applicable.





Item 14. Material Modifications To The Rights Of Security Holders And Use Of Proceeds.




Not Applicable.




Item 15. Controls And Procedures




(a) Disclosure Controls and Procedures





The Company maintains disclosure controls and procedures that are designed to ensure that the information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. After evaluating the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-14(c) and 15d – 14(c)) as of the end of the period covered by this report, the Chief Executive Officer and Chief Financial Officer concluded that as of such date, the Company’s disclosure controls and procedure were adequate and effective to ensure that material information relating to the Company and its consolidated subsidiaries would be made known to them by others within those entities.




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(b) Management’s annual report on internal control over financial reporting:





Our management, under the supervision of our Chief Executive Officer and Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over our financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with international financial reporting standards. Internal control over financial reporting includes policies and procedures that:





·
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and asset dispositions;


·
provide reasonable assurance that transactions are recorded as necessary to permit the preparation of our financial statements in accordance with international financial reporting standards;


·
provide reasonable assurance that receipts and expenditures are made only in accordance with authorizations of our management and board of directors (as appropriate); and


·
provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.





Due to its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.





Management conducted an assessment of the effectiveness of our internal control over financial reporting as of the fiscal year ended December 31, 2012 based on the criteria established by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework.Based on this evaluation, management concluded that, as of the fiscal year ended December 31, 2012, the Company’s internal control over our financial reporting was effective and management's assessment did not identify any material weaknesses.Management will continue to monitor and evaluate the effectiveness of our internal controls and procedures over financial reporting on an ongoing basis and is committed to implementing additional improvements as necessary.





(c) Attestation report of the registered public accounting firm





This Annual Report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm as the Company qualifies as a non-accelerated filer and is exempt pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act.




(d) Changes in internal control over financial reporting





There were no significant changes during the period covered by this Annual Report in the Company’s internal controls or in other factors that have materially adversely affected, or are reasonably likely to materially adversely affect, the Company’s internal control over financial reporting.




Item 16. [Reserved]




Item 16A. Audit Committee Financial Expert.




Our board of directors has determined that one of our directors, Patrick Cahill, CPA, satisfies the requirements of an audit committee financial expert serving on our audit committee as defined in the instructions to Item 16A of Form 20-F. Mr. Cahill is an independent director, as defined under the audit committee independent director requirements set forth in the NYSE - MKT Company Guide.




80








Item 16B. Code Of Ethics.




We have not adopted a formal code of ethics. We have concluded that a written code of ethics would serve little practical purpose for us in deterring wrongdoing and promoting ethical conduct and full, fair and accurate public disclosure and compliance with applicable laws and regulatory requirements. Since our operations are currently relatively small, most of our important activities are conducted directly by or under the direct supervision of our directors and senior officers. In light of the lack of perceived benefit from adopting a formal code considered against the time and cost for management to consider and implement a code, we have decided not to do so at the present time. We will continue to monitor the possible benefits of adopting a formal code of ethics, particularly as our operations and the number of our employees expand and will consider whether we should adopt a formal code of ethics at a future date.





Item 16C. Principal Accountant Fees And Services.




(a) Audit Fees





The aggregated audit fees billed for each of the past two fiscal years by our auditor, Dale Matheson Carr-Hilton LaBonte, Chartered Accountants, for professional services rendered for the audit of our annual financial statements or services that are normally provide in connection with statutory and regulatory filings were: $36,720 during the fiscal year ended December 31, 2012; and $36,720 during the fiscal year ended December 31, 2011.





(b) Audit-Related Fees





The aggregated audit related fees billed by our auditor, Dale Matheson Carr-Hilton LaBonte, Chartered Accountants, for professional services rendered were: $3,700 during the fiscal year ended December 31, 2012; and $3,000 during the fiscal year ended December 31, 2011.





(c) Tax Fees





The aggregate of tax fees billed by our auditor, Dale Matheson Carr-Hilton LaBonte, Chartered Accountants, for the preparation of all necessary Canadian tax returns for the Company and its subsidiaries was: $4,000 during the fiscal year ended December 31, 2012; and $4,000 during the fiscal year ended December 31, 2011.





(d) All Other Fees





Our auditor, Dale Matheson Carr-Hilton LaBonte, Chartered Accountants has not billed us for any other services during the past two fiscal years, than the audit fees, audit-related fees and tax fees noted above.





Audit Committee’s Pre-approval Policies and Procedures





The Audit Committee nominates and engages the independent auditors to audit the financial statements, and approves all audits, audit-related services, tax services and other services provided by the auditor. Any services provided by our independent auditor that are not specifically included within the scope of the audit must be pre-approved by the Audit Committee prior to any engagement. The Audit Committee is permitted to approve certain fees for audit-related services, tax services and other services pursuant to a de minimusexception before the completion of the engagement.





Item 16D. Exemptions From The Listing Standards For Audit Committees.




Not Applicable.





Item 16E. Purchase Of Equity Securities By The Issuer And Affiliated Purchases.




There were no known purchases of the Company’s securities by or on behalf of the Company or any affiliated purchaser during the period covered by this Annual Report.




81








Item 16F. Change in Registrant’s Certifying Accountant





Not Applicable.




Item 16G. Corporate Governance.





Not Applicable.





Item 16H. Mine Safety Disclosure





Not Applicable.





Item 17. Financial Statements




Not applicable as our consolidated financial statements have been prepared in accordance with Item 18.





Item 18. Financial Statements




We are furnishing the following financial statements and reports:





·
Auditor’s Report dated April 23, 2013


·
Consolidated Statements Of Financial Position at December 31, 2012 and December 31, 2011 and January 1, 2011


·
Consolidated Statements of Comprehensive Loss for the years ended December 31, 2012 and December 31, 2011


·
Consolidated Statements of Changes In Shareholder's Equity at December 31, 2012 and December 31, 2011 and January 1, 2011


·
Consolidated Statements of Cash Flows for the years ended December 31, 2012 and December 31, 2011


·
Notes to the Consolidated Financial Statements





All financial statements herein, unless otherwise stated, have been prepared in accordance with
 IFRS.    INDEPENDENT
AUDITORS REPORT To the Shareholders
of SAMEX Mining Corp. We have audited the accompanying
consolidated financial statements of SAMEX Mining Corp., which comprise the consolidated statements of financial position as at
December 31, 2012 and 2011, and January 1, 2011 and the consolidated statements of comprehensive income and loss, changes in shareholders’
equity and cash flows for the years ended December 31, 2012 and 2011, and a summary of significant accounting policies and other
explanatory information.  Management's Responsibility
for the Consolidated Financial Statements Management is responsible
for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial
Reporting Standards as issued by the International Accounting Standards Board, and for such internal control as management determines
is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due
to fraud or error. Auditor’s Responsibility Our responsibility is
to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with
Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures
selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated
financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant
to the entity's preparation and fair presentation of the consolidated 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 entity's
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 consolidated financial statements. We believe that the
audit evidence that we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated
financial statements present fairly, in all material respects, the financial position of SAMEX Mining Corp. as at December 31,
2012 and 2011, and January 1, 2011 and its financial performance and its cash flows for the years ended December 31, 2012 and 2011
in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. Emphasis of Matter Without modifying our opinion, we draw
attention to Note 1 to the consolidated financial statements which describes matters and conditions that indicate the existence
of a material uncertainty that cast significant doubt about SAMEX Mining Corp.’s ability to continue as a going concern.  DALE
MATHESON CARR-HILTON LABONTE LLP CHARTERED
ACCOUNTANTS Vancouver, Canada April 23, 2013 82
 
  SAMEX MINING CORP.  CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (EXPRESSED IN CANADIAN DOLLARS)   DECEMBER 31,
    
    DECEMBER 31,
    
    January 1,2012
    
    2011
    
    2011(Restated-Note 13)
    
    (Restated-Note 13)ASSETSCURRENT ASSETSCASH
    
    $
    2,756,359
    
    $
    3,991,264
    
    $
    4,870,337GOLD AND SILVER BULLION (NOTE 4)
    
    
    642,690
    
    
    5,807,372
    
    
    4,107,332OTHER CURRENT ASSETS
    
    
    131,996
    
    
    119,538
    
    
    32,5513,531,045
    
    
    9,918,174
    
    
    9,010,220NON-CURRENT ASSETSEQUIPMENT (NOTE 5)
    
    
    102,227
    
    
    81,295
    
    
    37,928EXPLORATION AND EVALUATIONASSETS (NOTE 6)
    
    
    18,139,082
    
    
    12,397,911
    
    
    10,068,37118,241,309
    
    
    12,479,206
    
    
    10,106,299TOTAL ASSETS
    
    $
    21,772,354
    
    $
    22,397,380
    
    $
    19,116,519LIABILITIESCURRENTTRADE PAYABLES ANDACCRUED LIABILITIES
    
    $
    193,848
    
    $
    89,210
    
    $
    91,890SHAREHOLDERS' EQUITYSHARE CAPITAL (NOTE 8)
    
    
    50,038,530
    
    
    50,033,530
    
    
    44,702,328RESERVES
    
    
    6,192,002
    
    
    5,145,437
    
    
    3,028,356DEFICIT
    
    
    (34,652,026)
    
    
    (32,870,797)
    
    
    (28,706,055)21,578,506
    
    
    22,308,170
    
    
    19,024,629TOTAL LIABILITIES ANDSHAREHOLDERS' EQUITY
    
    $
    21,772,354
    
    $
    22,397,380
    
    $
    19,116,519      NATURE AND CONTINUANCE OF OPERATIONS (NOTE 1) SUBSEQUENT EVENTS (NOTES 4, 6, 9 AND 12) COMMITMENTS (NOTE 6)   APPROVED BY THE DIRECTORS  “Sasan
    Sadeghpour”Director“Travis
    Cocke”Director      SEE
ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  83
 
 SAMEX MINING CORP. CONSOLIDATED STATEMENTS OF COMPREHENSIVE
LOSS (EXPRESSED IN CANADIAN DOLLARS)     YEAR ENDED DECEMBER 31,2012
    
    2011(Restated-Note 13)EXPENSESAMORTIZATION
    
    
    
    
    $
    36,466
    
    $
    47,037CONSULTING FEES (NOTE 9)
    
    
    
    
    
    33,050
    
    
    34,875FOREIGN EXCHANGE
    
    
    
    
    
    55
    
    
    1,581IMPAIRMENT OF EXPLORATION AND EVALUATION ASSETS
    
    
    215,450
    
    
    19,142INTEREST AND BANK CHARGES
    
    
    
    
    
    19,901
    
    
    25,661MINERAL INTERESTS, ADMINISTRATION ANDINVESTIGATION COSTS
    
    
    
    
    
    387,787
    
    
    287,369OFFICE AND MISCELLANEOUS
    
    
    
    
    
    127,822
    
    
    148,667PROFESSIONAL FEES (NOTE 9)
    
    
    
    
    
    450,555
    
    
    166,606REGULATORY FEES
    
    
    
    
    
    22,607
    
    
    24,882SALARIES AND BENEFITS
    
    
    
    
    
    455,631
    
    
    608,569STOCK-BASED COMPENSATION (NOTE 8)
    
    
    
    
    
    -
    
    
    2,626,421TRANSFER AGENT FEES
    
    
    
    
    
    12,049
    
    
    12,207TRAVEL AND PROMOTION
    
    
    
    
    
    104,934
    
    
    139,089LOSS FROM OPERATIONS
    
    
    
    
    
    1,866,307
    
    
    4,142,106GAIN ON GOLD AND SILVER BULLION (NOTE 4)
    
    
    
    
    
    (419,332)
    
    
    (433,233)NET LOSS
    
    
    
    
    
    1,446,975
    
    
    3,708,873OTHER COMPREHENSIVE INCOME (LOSS)TRANSLATION GAIN (LOSS)
    
    
    
    
    
    685,420
    
    
    (1,143,999)COMPREHENSIVE LOSS
    
    
    
    
    $
    761,555
    
    $
    4,852,872WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
    
    
    126,731,636
    
    
    124,987,219LOSS PER SHARE - BASIC AND DILUTED
    
    
    
    
    $
    (0.02)
    
    $
    (0.03)   SEE
ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  84
 
 SAMEX MINING CORP. CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (EXPRESSED IN CANADIAN DOLLARS)  SHARE CAPITAL
    
    RESERVESSHARE-BASED
    
    FOREIGNNUMBER
    
    
    
    
    PAYMENT
    
    EXCHANGEOF SHARES
    
    AMOUNT
    
    RESERVE
    
    RESERVE
    
    DEFICIT
    
    TOTALBALANCE AT JANUARY 1, 2011(Restated-Note 13)
    
    
    119,467,719
    
    $
    44,702,328
    
    $
    3,267,329
    
    $
    (238,973)
    
    $
    (28,706,055)
    
    $
    19,024,629TOTAL COMPREHENSIVE LOSSFOR THE PERIOD
    
    
    -
    
    
    -
    
    
    -
    
    
    (1,143,999)
    
    
    (3,708,873)
    
    
    (4,852,872)SHARES ISSUED FOR CASH -WARRANT EXERCISE
    
    
    6,941,000
    
    
    5,227,662
    
    
    (552,162)
    
    
    -
    
    
    -
    
    
    4,675,500OPTION EXERCISE
    
    
    300,000
    
    
    103,540
    
    
    (43,540)
    
    
    -
    
    
    -
    
    
    60,000SHARE BASED PAYMENTS
    
    
    -
    
    
    -
    
    
    3,400,913
    
    
    -
    
    
    -
    
    
    3,400,913WARRANT EXTENSION
    
    
    -
    
    
    -
    
    
    455,869
    
    
    -
    
    
    (455,869)
    
    
    -BALANCE AT DECEMBER 31, 2011(Restated-Note 13)
    
    
    126,708,719
    
    
    50,033,530
    
    
    6,528,409
    
    
    (1,382,972)
    
    
    (32,870,797)
    
    
    22,308,170TOTAL COMPREHENSIVE LOSSFOR THE PERIOD
    
    
    -
    
    
    -
    
    
    -
    
    
    685,420
    
    
    (1,446,975)
    
    
    (761,555)SHARES ISSUED FOR CASH -WARRANT EXERCISE
    
    
    25,000
    
    
    5,000
    
    
    -
    
    
    -
    
    
    -
    
    
    5,000SHARE BASED PAYMENTS
    
    
    -
    
    
    -
    
    
    26,891
    
    
    -
    
    
    -
    
    
    26,891WARRANT EXTENSIONS
    
    
    -
    
    
    -
    
    
    1,223,677
    
    
    -
    
    
    (1,223,677)
    
    
    -EXPIRY OF OPTIONS
    
    
    -
    
    
    -
    
    
    (217,883)
    
    
    -
    
    
    217,883
    
    
    -FORFEITURE OF OPTIONS
    
    
    -
    
    
    -
    
    
    (671,540)
    
    
    -
    
    
    671,540
    
    
    -BALANCE AT DECEMBER 31, 2012
    
    
    126,733,719
    
    $
    50,038,530
    
    $
    6,889,554
    
    $
    (697,552)
    
    $
    (34,652,026)
    
    $
    21,578,506   SEE
ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 85
 
 SAMEX MINING CORP. CONSOLIDATED STATEMENTS OF CASH
FLOWS (EXPRESSED IN CANADIAN DOLLARS)   YEARS ENDED DECEMBER 31,2012
    
    2011(Restated-Note 13)CASH PROVIDED (USED) BYOPERATING ACTIVITIESNET LOSS
    
    $
    (1,446,975)
    
    $
    (3,708,873)ADJUSTMENTS FOR NON-CASH ITEMS:AMORTIZATION
    
    
    36,466
    
    
    47,037GAIN ON GOLD AND SILVER BULLION
    
    
    (419,332)
    
    
    (433,233)GOLD AND SILVER BULLION VAULT FEES
    
    
    15,931
    
    
    21,993IMPAIRMENT OF EXPLORATION AND EVALUTION ASSETS
    
    215,450
    
    
    19,142STOCK-BASED COMPENSATION
    
    
    -
    
    
    2,626,421CHANGES IN NON-CASH WORKING CAPITAL ITEMSOTHER CURRENT ASSETS
    
    
    (12,457)
    
    
    (86,987)TRADE PAYABLES AND ACCRUED LIABILITIES
    
    
    104,638
    
    
    (2,680)NET CASH FLOW USED IN OPERATING ACTIVITIES
    
    
    (1,506,279)
    
    
    (1,517,180)INVESTING ACTIVITIESEXPENDITURES ON EXPLORATION AND EVALUATION ASSETS
    (5,244,231)
    
    
    (2,570,758)EXPENDITURES ON EQUIPMENT
    
    
    (24,715)
    
    
    (101,509)PROCEEDS FROM GOLD AND SILVER BULLION
    
    
    5,568,083
    
    
    1,220,290PURCHASE OF GOLD AND SILVER BULLION
    
    
    -
    
    
    (2,509,090)NET CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES
    
    299,137
    
    
    (3,961,067)FINANCING ACTIVITIESPROCEEDS ON ISSUANCE OF COMMON SHARES -NET OF SHARE ISSUE COSTS
    
    
    5,000
    
    
    4,735,500NET CASH FLOWS FROM INVESTING ACTIVITIES
    
    
    5,000
    
    
    4,735,500EFFECT OF FOREIGN EXHANGE ON CASH
    
    
    (32,763)
    
    
    (136,328)DECREASE IN CASH
    
    
    (1,202,142)
    
    
    (742,747)CASH, BEGINNING
    
    
    3,991,264
    
    
    4,870,337CASH, ENDING
    
    $
    2,756,359
    
    $
    3,991,262    SEE
ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 86
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)   1.    NATURE
AND CONTINUANCE OF OPERATIONS  SAMEX Mining Corp. (the
“Company”) was incorporated on December 15, 1967 under the laws of the province of British Columbia, Canada, and its
principal activity is the acquisition and exploration of exploration and evaluation assets in Chile. The Company’s shares
are traded on the TSX Venture Exchange (“TSX-V”) under the symbol “SXG”. The head office and principal
address of the Company is located at #301 - 32920 Ventura Ave., Abbotsford, British Columbia, Canada V2S 6J3. The Company’s
registered address and records office is located at #3000 Royal Centre, 1055 West Georgia Street, Vancouver, British Columbia,
Canada, V6E 3R3. These consolidated financial
statements have been prepared on the assumption that the Company and its subsidiaries will continue as a going concern, meaning
it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary
course of operations. As at December 31, 2012, the Company had not advanced its property to commercial production and is not able
to finance day to day activities through operations. The Company’s continuation as a going concern is dependent upon successful
results from its mineral property exploration activities and its ability to attain profitable operations and generate funds there
from and/or raise equity capital or borrowings sufficient to meet current and future obligations. These factors indicate the existence
of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern. Management
intends to finance operating costs over the next twelve months with its cash, proceeds from the exercise of warrants or private
placement of common shares. Should the Company be unable to continue as a going concern, the net realizable value of its assets
may be materially less than the amounts on its consolidated statement of financial position.  2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION The financial statements
were authorized for issue on April 23, 2013 by the directors of the Company. Statement of compliance
with International Financial Reporting Standards The consolidated financial
statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”)
issued by the International Accounting Standards Board (“IASB”) and interpretations of the International Financial
Reporting Interpretations Committee (“IFRIC”). Basis of measurement The consolidated financial
statements of the Company have been prepared on an accrual basis and are based on historical costs, modified where applicable.
The consolidated financial statements are presented in Canadian dollars.  87
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)   2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (CONTINUED) Consolidation The consolidated financial
statements include the accounts of the Company and its controlled entities. Details of controlled entities are as follows:    Percentage OwnedCountry of
    December 31,Incorporation
    2012
    2011Minera Samex Chile S.A.
    
    Chile
    99.9%
    99.9%South American Mining & Exploration Corp. - Inactvive
    
    Canada
    100.0%
    100.0%Samex International Ltd. - Inactive
    
    Bahamas
    100.0%
    100.0%Empresa Minera Boliviana S.A. ("Emibol")
    
    Bolivia
    98.0%
    98.0%Samex S.A. - Inactive
    
    Bolivia
    98.0%
    98.0%Minas Bolivex S.A. ("Bolivex") - Inactive
    
    Bolivia
    98.0%
    98.0% Inter-company balances and transactions, including unrealized income and expenses arising from inter-company
transactions, are eliminated on consolidation.   Significant accounting judgments, estimates
and assumptions The preparation of financial
statements in accordance with IFRS requires the Company to make estimates and assumptions concerning the future. The Company’s
management reviews these estimates and underlying assumptions on an ongoing basis, based on experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. Revisions to estimates are adjusted for
prospectively in the period in which the estimates are revised. Estimates and assumptions
where there is significant risk of material adjustments to assets and liabilities in future accounting periods include the useful
lives of equipment, the recoverability of the carrying value of exploration and evaluation assets, fair value measurements for
financial instruments and stock-based compensation and other equity-based payments, the recoverability and measurement of deferred
tax assets, provisions for restoration and environmental liabilities, and contingent liabilities. Significant judgments The preparation of financial
statements in accordance with IFRS requires the Company to make judgments, apart from those involving estimates, in applying accounting
policies. The most significant judgments in applying the Company’s financial statements include: ·The assessment of the Company’s ability
to continue as a going concern and whether there are events or conditions that may give rise to significant uncertainty; ·The classification and allocation of expenditures
as exploration and evaluation expenditures or operating expenses; ·The classification of financial instruments;
and ·The determination of the functional currency
of the parent company and its subsidiaries. 88
 
 SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (CONTINUED) Foreign currency translation The functional currency
of each controlled entity is measured using the currency of the primary economic environment in which that entity operates. The
consolidated financial statements are presented in Canadian dollars which is the parent company’s functional and presentation
currency. The functional currency of the Company’s subsidiary, Minera Samex Chile S.A., is the Chilean peso. Transactions and balances: Foreign currency transactions
are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary
items are translated at the period-end exchange rate. Non-monetary items measured at historical cost continue to be carried at
the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at
the date when fair values were determined. Exchange differences arising
on the translation of monetary items or on settlement of monetary items are recognized in the statement of comprehensive loss in
the period in which they arise, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising
on the translation of non-monetary items are recognized in other comprehensive income in the statement of comprehensive income
to the extent that gains and losses arising on those non-monetary items are also recognized in other comprehensive income. Where
the non-monetary gain or loss is recognized in profit or loss, the exchange component is also recognized in profit or loss. Share-based payments The Company maintains an
employee stock option plan. Share-based payments to employees are measured at the fair value of the instruments issued and amortized
over the vesting periods. Share-based payments to non-employees are measured at the fair value of goods or services received or
the fair value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be reliably
measured, and are recorded at the date the goods or services are received. The corresponding amount is recorded to the share-based
payment reserve. The fair value of options is determined using a Black–Scholes pricing model which incorporates all market
vesting conditions. The number of shares and options expected to vest is reviewed and adjusted at the end of each reporting period
such that the amount recognized for services received as consideration for the equity instruments granted shall be based on the
number of equity instruments that eventually vest. Loss per share Basic loss per share is
calculated by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding
in the period.  For all periods presented, the loss attributable to common shareholders equals the reported loss attributable
to owners of the Company.  Diluted loss per share is calculated by the treasury stock method.  Under the treasury stock
method, the weighted average number of common shares outstanding for the calculation of diluted loss per share assumes that the
proceeds to be received on the exercise of dilutive share options and warrants are used to repurchase common shares at the average
market price during the period. 89
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (CONTINUED) Exploration and evaluation
expenditures Costs incurred before the
Company has obtained the legal rights to explore an area are expensed as incurred. Exploration and evaluation
expenditures include the costs of acquiring licenses, costs associated with exploration and evaluation activity, and the fair value
(at acquisition date) of exploration and evaluation assets acquired in a business combination. Option payments are considered acquisition
costs provided that the Company has the intention of exercising the underlying option. Property option agreements
are exercisable entirely at the option of the optionee. Therefore, option payments (or recoveries) are recorded when the payment
is made (or received) and are not accrued. Exploration and evaluation
expenditures are capitalized. The Company capitalizes costs to specific blocks of claims or areas of geological interest. Government
tax credits received are recorded as a reduction to the cumulative costs incurred and capitalized on the related property. Exploration and evaluation
assets are assessed for impairment if facts or circumstances indicate that impairment exists. Examples of such facts and circumstances
are as follows: ·The period for which the Company has the
right to explore in a specific area has expired during the period or will expire in the near future, and is not expected to be
renewed; ·Substantive expenditure on further exploration
for and evaluation of mineral resources in the specific area is neither budgeted nor planned; ·Exploration for and evaluation of mineral
resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the entity
has decided to discontinue such activities in the specific area; and ·Sufficient data exits to indicate that, although
a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely
to be recovered in full from successful development or by sale. After technical feasibility
and commercial viability of extracting a mineral resource are demonstrable, the Company stops capitalizing expenditures for the
applicable block of claims or geological area of interest and tests the asset for impairment. The capitalized balance, net of any
impairment recognized, is then reclassified to either tangible or intangible mine development assets according to the nature of
the asset. Financial instruments The Company classifies its
financial instruments in the following categories: at fair value through profit or loss, loans and receivables, held-to-maturity
investments, available-for-sale and financial liabilities. The classification depends on the purpose for which the financial instruments
were acquired. Management determines the classification of its financial instruments at initial recognition. Financial assets are classified
at fair value through profit or loss when they are either held for trading for the purpose of short-term profit taking, derivatives
not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation
where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented
risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being
included in profit or loss. Loans and receivables are
non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently
measured at amortized cost. They are included in current assets, except for maturities greater than 12 months after the end of
the reporting period. These are classified as non-current assets. 90
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (CONTINUED) Financial instruments
(continued) Held-to-maturity investments
are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the Company’s
intention to hold these investments to maturity. They are subsequently measured at amortized cost.  Held-to-maturity investments
are included in non-current assets, except for those which are expected to mature within 12 months after the end of the reporting
period.  Available-for-sale financial
assets are non-derivative financial assets that are designated as available-for-sale or are not suitable to be classified as financial
assets at fair value through profit or loss, loans and receivables or held-to-maturity investments and are subsequently measured
at fair value.  These are included in current assets to the extent they are expected to be realized within 12 months after
the end of the reporting period. Unrealized gains and losses are recognized in other comprehensive income, except for impairment
losses and foreign exchange gains and losses on monetary financial assets. Non-derivative financial
liabilities (excluding financial guarantees) are subsequently measured at amortized cost. Regular purchases and sales
of financial assets are recognized on the trade-date – the date on which the Company commits to purchase the asset. Financial assets are derecognized
when the rights to receive cash flows from the investments have expired or have been transferred and the Company has transferred
substantially all risks and rewards of ownership. At each reporting date,
the Company assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale
financial instruments, a significant and prolonged decline in the value of the instrument is considered to determine whether an
impairment has arisen. The Company does not have
any derivative financial assets and liabilities. Impairment of assets The
carrying amount of the Company’s assets (which include equipment and exploration and evaluation assets)
is reviewed at each reporting date to determine whether there is any indication of impairment. If such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent of the impairment loss. An impairment loss is recognized whenever
the carrying amount of an asset or its cash generating unit exceeds its recoverable amount.Impairment losses are recognized
in the statement of comprehensive loss. The recoverable amount of
assets is the greater of an asset’s fair value less cost to sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a pre-tax discount rate that reflects the current market assessments
of the time value of money and the risks specific to the asset. For an asset that does not generate cash inflows largely independent
of those from other assets, the recoverable amount is determined for the cash-generating unit to which the asset belongs. An impairment loss is only
reversed if there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used
to determine the recoverable amount. Any reversal of the impairment cannot increase the carrying value of the asset to an amount
higher than the carrying amount that would have been determined had no impairment loss been recognized in previous years. Assets that have an indefinite
useful life are not subject to amortization and are tested annually for impairment. 91
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (CONTINUED) Income taxes Current income tax: Current income tax assets
and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities.
The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date,
in the countries where the Company operates and generates taxable income. Current income tax relating
to items recognized directly in other comprehensive income or equity is recognized in other comprehensive income or equity and
not in profit or loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which
applicable tax regulations are subject to interpretation and establishes provisions where appropriate. Deferred income tax: Deferred income tax is provided
using the balance sheet method on temporary differences at the reporting date between the tax bases of assets and liabilities and
their carrying amounts for financial reporting purposes. The carrying amount of deferred
income tax assets is reviewed at the end of each reporting period and recognized only to the extent that it is probable that sufficient
taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Deferred income tax assets
and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability
is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred income tax assets
and deferred income tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current
income tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority. Restoration and environmental
obligations The Company recognizes liabilities
for statutory, contractual, constructive or legal obligations associated with the retirement of long-term assets, when those obligations
result from the acquisition, construction, development or normal operation of the assets. The net present value of future restoration
cost estimates arising from the decommissioning of plant and other site preparation work is capitalized to the related asset along
with a corresponding increase in the restoration provision in the period incurred. Discount rates using a pre-tax rate that reflect
the time value of money are used to calculate the net present value. The Company’s estimates
of restoration costs could change as a result of changes in regulatory requirements, discount rates and assumptions regarding the
amount and timing of the future expenditures. These changes are recorded directly to the related asset with a corresponding entry
to the restoration provision. The Company’s estimates are reviewed annually for changes in regulatory requirements, discount
rates, effects of inflation and changes in estimates. Changes in the net present
value, excluding changes in the Company’s estimates of restoration costs, are charged to the statement of comprehensive loss
for the period. The net present value of
restoration costs arising from subsequent site damage that is incurred on an ongoing basis during production are charged to the
statement of comprehensive loss in the period incurred. The costs of restoration
projects that were included in the provision are recorded against the provision as incurred. The costs to prevent and control environmental
impacts at specific properties are capitalized in accordance with the Company’s accounting policy for exploration and evaluation
assets. 92
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  2.SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION (CONTINUED) Equipment Equipment is stated at historical
cost less accumulated depreciation and accumulated impairment losses. Subsequent costs are included
in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount
of the replaced part is derecognized. All other repairs and maintenance are charged to the statement of income and comprehensive
loss during the financial period in which they are incurred. Gains and losses on disposals
are determined by comparing the proceeds with the carrying amount and are recognized in profit or loss. Amortization is calculated
on a straight-line method to write off the cost of the assets to their residual values over their estimated useful lives. The amortization
rates applicable to each category of equipment are as follows:  Class of equipment
    Depreciation rateMotor vehicles
    5 yearsExploration equipment
    4 to 8 yearsOffice equipment
    4 to 10 years  3.ACCOUNTING
 STANDARDS ISSUED BUT NOT YET EFFECTIVE New standard IFRS 9 “Financial Instruments” This new standard is a partial
replacement of IAS 39 “Financial Instruments: Recognition and Measurement”. IFRS 9 uses a single approach to determine
whether a financial asset is measured at amortized cost or fair value, replacing the multiple rules in IAS 39. The approach in
IFRS 9 is based on how an entity manages its financial instruments in the context of its business model and the contractual cash
flow characteristics of the financial assets. The new standard also requires
a single impairment method to be used, replacing the multiple impairment methods in IAS 39. IFRS 9 is effective for annual periods
beginning on or after January 1, 2015. New standard IFRS 10 “Consolidated
Financial Statements” This new standard will replace
IAS 27 “Consolidated and Separate Financial Statements”, and SIC-12 “Consolidation – Special Purpose Entities”.
Concurrent with IFRS 10, the IASB issued IFRS 11 “Joint Ventures”; IFRS 12 “Disclosures of Involvement with Other
Entities”; IAS 27 “Separate Financial Statements”, which has been amended for the issuance of IFRS 10 but retains
the current guidance for separate financial statements; and IAS 28 “Investments in Associates and Joint Ventures”,
which has been amended for conforming changes based on the issuance of IFRS 10 and IFRS 11. IFRS 10 uses control as
the single basis for consolidation, irrespective of the nature of the investee, eliminating the risks and rewards approach included
in SIC-12, and requires continuous assessment of control over an investee. The above consolidation standards are effective for
annual periods beginning on or after January 1, 2013. New standard IFRS
11 “Joint Arrangements” This new standard requires
a venturer to classify its interest in a joint arrangement as a joint venture or joint operation.  Joint ventures will be
accounted for using the equity method of accounting whereas for a joint operation the venture will recognize its share of the assets,
liabilities, revenue and expenses of the joint operation. Under existing IFRS, entities have the choice to proportionately consolidate
or equity account for interests in joint ventures. IFRS 11 supersedes lAS 31, Interests in Joint Ventures, and SIC-13, Jointly
Controlled Entities-Non-monetary Contributions by Venturers. 93
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  3.ACCOUNTING
 STANDARDS ISSUED BUT NOT YET EFFECTIVE (CONTINUED) New standard IFRS
12 “Disclosure of Interests in Other Entities” This
new standard establishes disclosure requirements for interests in other entities, such as joint arrangements, associates, special
purpose vehicles and off balance sheet vehicles. The standard carries forward existing disclosures and also introduces significant
additional disclosure requirements that address the nature of, and risks associated with, an entity's interests in other entities.
IFRS 12 is effect for annual periods beginning on or after January 1, 2013. New standard IFRS 13 “Fair value measurement” This
new standard replaces the fair value measurement guidance currently included in various other IFRS standards with a single definition
of fair value and extensive application guidance. IFRS 13 provides guidance on how to measure fair value and does not introduce
new requirements for when fair value is required or permitted. It also establishes disclosure requirements to provide users of
the financial statements with more information about fair value measurements. IFRS 13 is effective for annual periods beginning
on or after January 1, 2013. Amendments to IAS
32 “Financial Instruments: Presentation” These amendments address
inconsistencies when applying the offsetting requirements, and are effective for annual periods beginning on or after January 1,
2014. Financial statement
presentation In June 2011, the IASB and
the Financial Accounting Standards Board (“FASB”) issued amendments to standards to align the presentation requirements
for other comprehensive income (“OCI”). The IASB issued amendments to IAS 1 “Presentation of Financial Statements”
to require companies preparing financial statements under IFRS to group items within OCI that may be reclassified to the profit
or loss. The amendments also reaffirm existing requirements that items in OCI and profit or loss should be presented as either
a single statement or two consecutive statements. The amendments are effective for fiscal years beginning on or after July 1, 2012. The Company has not early
adopted these revised standards and is currently assessing the impact that these standards will have on its consolidated financial
statements. Other accounting standards
or amendments to existing accounting standards that have been issued but have future effective dates are either not applicable
or are not expected to have a significant impact on the Company’s financial statements. 4.GOLD AND SILVER BULLION Gold and silver bullion
are measured at fair value with changes in carrying values being included in profit and loss. During the year ended December
31, 2011, the Company sold 35,000 ounces of silver bullion for proceeds of $1,220,291 and purchased $1,799,950 of gold bullion
and $709,140 of silver bullion. The Company held 87,362 grams of gold bullion and 50,019 ounces of silver bullion which had a fair
value of $5,807,372 at December 31, 2011. During the year ended December
31, 2012, the Company sold 81,040 grams of gold bullion and 39,300 ounces of silver bullion for proceeds of $5,568,083. The Company
held 6,230 grams of gold and 10,328 ounces of silver which had fair value of $642,690 at December 31, 2012. Subsequent to the year ended
December 31, 2012, the Company sold its remaining gold and silver bullion for proceeds of $651,753. During the year ended December
31, 2012, the Company recognized a gain of $419,332 (2011 - $433,233) on the sale of, or changes in fair value of its gold and
silver bullion. 94
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  5.Equipment  Motor
    
    Exploration
    
    OfficeVehicles
    
    Equipment
    
    Equipment
    
    TotalCostAt December 31, 2011
    
    $
    206,341
    
    $
    69,333
    
    $
    151,200
    
    $
    426,874Net additions
    
    
    5,119
    
    
    9,168
    
    
    10,428
    
    
    24,715At December 31, 2012
    
    
    211,460
    
    
    78,501
    
    
    161,628
    
    
    451,589DepreciationAt December 31, 2011
    
    
    130,996
    
    
    62,697
    
    
    122,264
    
    
    315,957Charge
    
    
    22,335
    
    
    3,742
    
    
    10,389
    
    
    36,466At December 31, 2012
    
    
    153,331
    
    
    66,439
    
    
    132,653
    
    
    352,423Currency adjustmentAt December 31, 2011
    
    
    (20,122)
    
    
    (1,772)
    
    
    (7,728)
    
    
    (29,622)At December 31, 2012
    
    
    2,621
    
    
    389
    
    
    51
    
    
    3,061Net book valueAt December 31, 2011
    
    
    55,223
    
    
    4,864
    
    
    21,208
    
    
    81,295At December 31, 2012
    
    $
    60,750
    
    $
    12,451
    
    $
    29,026
    
    $
    102,227    Motor
    
    Exploration
    
    OfficeVehicles
    
    Equipment
    
    Equipment
    
    TotalCostAt December 31, 2010
    
    $
    150,225
    
    $
    61,329
    
    $
    132,321
    
    $
    343,875Additions
    
    
    74,626
    
    
    8,004
    
    
    18,879
    
    
    101,509Disposals
    
    
    (18,510)
    
    
    -
    
    
    -
    
    
    (18,510)At December 31, 2011
    
    
    206,341
    
    
    69,333
    
    
    151,200
    
    
    426,874DepreciationAt December 31, 2010
    
    
    114,833
    
    
    59,544
    
    
    113,053
    
    
    287,430Charge
    
    
    34,673
    
    
    3,153
    
    
    9,211
    
    
    47,037Disposals
    
    
    (18,510)
    
    
    -
    
    
    -
    
    
    (18,510)At December 31, 2011
    
    
    130,996
    
    
    62,697
    
    
    122,264
    
    
    315,957Currency adjustmentAt December 31, 2010
    
    
    (11,610)
    
    
    (586)
    
    
    (6,321)
    
    
    (18,517)At December 31, 2011
    
    
    (20,122)
    
    
    (1,772)
    
    
    (7,728)
    
    
    (29,622)Net book valueAt December 31, 2010
    
    
    23,782
    
    
    1,199
    
    
    12,947
    
    
    37,928At December 31, 2011
    
    $
    55,223
    
    $
    4,864
    
    $
    21,208
    
    $
    81,295     95
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  6.EXPLORATION
AND EVALUATION ASSETS   Miscellaneous
    
    Eskapa
    
    Balance
    
    BalanceProperties -
    
    El Desierto
    
    December 31,
    
    December 31,Los Zorros
    
    Chimberos
    
    INCA
    
    Espejismo
    
    Chile
    
    Santa Isabel
    
    2012
    
    2011Property acquisition costsBalance beginning of period
    
    $
    1,366,712
    
    $
    14,298
    
    $
    1,921,274
    
    $
    1,000
    
    $
    1,000
    
    $
    3,000
    
    $
    3,307,284
    
    $
    3,078,210Additions
    
    
    98,408
    
    
    3,383
    
    
    20,735
    
    
    -
    
    
    -
    
    
    -
    
    
    122,526
    
    
    229,074Write-down due to impairment
    
    
    (154,651)
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    (3,000)
    
    
    (157,651)
    
    
    -$
    1,310,469
    
    $
    17,681
    
    $
    1,942,009
    
    $
    1,000
    
    $
    1,000
    
    $
    -
    
    $
    3,272,159
    
    $
    3,307,284Exploration and evaluation costsBalance beginning of period
    
    $
    7,257,888
    
    $
    154,517
    
    $
    1,678,222
    
    $
    -
    
    $
    -
    
    $
    -
    
    $
    9,090,627
    
    $
    6,990,161Costs incurred during periodDrilling and sub-contracts
    
    
    2,924,341
    
    
    564,597
    
    
    68,126
    
    
    -
    
    
    -
    
    
    -
    
    
    3,557,064
    
    
    1,160,343Field camp supplies
    
    
    70,787
    
    
    386
    
    
    23,955
    
    
    -
    
    
    -
    
    
    424
    
    
    95,552
    
    
    64,490Geology, mapping, surveys - cash
    364,030
    
    
    4,406
    
    
    1,406
    
    
    -
    
    
    -
    
    
    -
    
    
    369,842
    
    
    589,769Geology, mapping, surveys -stock-based compensation
    
    
    26,891
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    26,891
    
    
    774,491Legal
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    378
    
    
    378
    
    
    4,135Property patent payments
    
    
    88,236
    
    
    9,987
    
    
    40,215
    
    
    10,237
    
    
    4
    
    
    -
    
    
    148,679
    
    
    148,889Site/project administration
    
    
    30,190
    
    
    1,891
    
    
    20,036
    
    
    -
    
    
    -
    
    
    -
    
    
    52,117
    
    
    58,107Travel and accommodation
    
    
    80,132
    
    
    15,682
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    95,814
    
    
    56,6703,584,607
    
    
    596,949
    
    
    153,738
    
    
    10,237
    
    
    4
    
    
    802
    
    
    4,346,337
    
    
    2,856,894OtherAdvance royalty payments
    
    
    99,083
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    99,083
    
    
    97,740Value-added taxes
    
    
    703,176
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    703,176
    
    
    161,541Write-down due to impairment
    
    
    (46,756)
    
    
    -
    
    
    -
    
    
    (10,237)
    
    
    (4)
    
    
    (802)
    
    
    (57,799)
    
    
    (19,142)Currency adjustment
    
    
    511,713
    
    
    29,443
    
    
    144,343
    
    
    -
    
    
    -
    
    
    -
    
    
    685,499
    
    
    (996,567)1,267,216
    
    
    29,443
    
    
    144,343
    
    
    (10,237)
    
    
    (4)
    
    
    (802)
    
    
    1,429,959
    
    
    (756,428)$
    12,109,711
    
    $
    780,909
    
    $
    1,976,303
    
    $
    -
    
    $
    -
    
    $
    -
    
    $
    14,866,923
    
    $
    9,090,627Total
    
    
    
    $
    13,420,180
    
    $
    798,590
    
    $
    3,918,312
    
    $
    1,000
    
    $
    1,000
    
    $
    -
    
    $
    18,139,082
    
    $
    12,397,911   96
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  6.EXPLORATION AND EVALUATION ASSETS (CONTINUED)  The following is a description
of the Company’s mineral exploration assets and the related expenditure commitments: The Company has invested in
various mineral interests located in Chile and Bolivia. The mineral interests have been acquired by purchase agreements, staking,
option agreements, purchase at government auctions, or by earning a percentage interest in certain properties pursuant to a joint
venture or other type of agreement. Government patent fees must be paid each year in order to keep the mineral concessions valid
and in effect. CHILE i.Los Zorros Property – As described below, the Company has a 100% interest in mineral
concessions acquired by staking, purchase at government auction, purchase agreement, and by option contracts Minera Ojos del Salado
Purchase – The Company acquired a 100% interest in mineral interests for U.S. $50,000 (paid). The vendor retained a back-in
option to earn a 30% to 51% interest in the event that the Company discovers a deposit containing not less than 2,000,000 tonnes
of contained equivalent copper on the mineral interests. Hochschild Option –
The Company acquired a 100% interest in mineral interests for consideration of option payments totaling U.S. $230,000 (paid). The
concessions are subject to a net smelter royalty (“NSR”) of up to 2%. The Company has the option to buy out the NSR
at any time for U.S. $1,800,000. As the concessions were not in production as at December 31, 2007, the Company was required to
pay annual advance NSR payments of U.S. $100,000 per year from February 29, 2008 to March 1, 2012 to a maximum of U.S. $500,000
(U.S. $500,000 paid). The advance NSR payments are recoverable from future NSR payments. San Estaban Option
– The Company acquired a 100% interest in mineral interests for consideration of option payments totaling U.S. $200,000 (paid).
A 1.5% NSR was retained by the vendor. Geosupply Servicios Bonus
and Royalty - Pursuant to a consulting agreement dated September 25, 2002, the concessions above comprising the Los Zorros
property are subject to a bonus of U.S. $150,000 payable within one year from the date of commencement of commercial production
on the concessions and to a 0.25% NSR. Aravena Option –
The Company had an option to acquire a 100% interest in mineral concessions adjacent to the Los Zorros property by paying the 2011
patent payments (paid) and by making option payments totaling the Chilean peso equivalent of U.S. $245,345 as follows: U.S. $60,000
due on signing (paid); U.S. $95,345 due January 31, 2012 (paid) and U.S. $90,000 due January 31, 2013. Subsequent to the year ended
December 31, 2012, the Company did not exercise the Aravena Option and did not make the final option payment. This resulted in
an impairment of $201,407. iiChimberos Property – The Company has a 100% interest in mineral concessions acquired
by staking and purchasing concessions at government auction. 97
 
 SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  6.EXPLORATION AND EVALUATION ASSETS (CONTINUED) CHILE (CONTINUED) iii.INCA Property – As described below, the Company has a 100% interest in mineral concessions
acquired by staking, purchase at government auction, and purchase and option agreements: Araya Option –
The Company acquired a 100% interest in mineral interests (the Providencia Mine concessions situated within the greater INCA project
area) for consideration of option payments totaling U.S. $300,000 (paid). A 1% NSR was retained by the vendor for a period of 20
years, however the Company has entered into an agreement to buy out the 1% NSR by making ten payments totaling U.S. $50,000 as
follows: U.S. $5,000 due August 31, 2012 (paid); U.S. $5,000 due October 4, 2012 (paid); U.S. $5,000 due November 4, 2012 (paid);
U.S. $5,000 due December 4, 2012 (paid); U.S. $5,000 due January 4, 2013 (paid); U.S. $5,000 due February 4, 2013 (paid); U.S.
$5,000 due March 4, 2013 (paid); U.S. $5,000 due April 4, 2013 (paid); U.S. $5,000 due May 4, 2013; and U.S. $5,000 due June 4,
2013. Rojas Option/Purchase
– The Company acquired a 100% interest in mineral concessions for consideration of U.S. $ 300,000 (paid). iv.Espejismo Prospects– The Company has a 100% interest in mineral concessions acquired
by staking and purchasing concessions at government auction. The property is inactive and no exploration is planned until additional
concessions are acquired, consequently the interest was written down at December 31, 2012 to a nominal value of $1,000. v.Miscellaneous Property Interests- The Company holds mineral concessions for possible future
evaluation. The mineral concessions are inactive and no exploration is currently planned, consequently the interests were written
down at December 31, 2012 to a nominal value of $1,000. BOLIVIA The Eskapa, El Desierto
and Santa Isabel properties in Bolivia have been on "care and maintenance" status since the Company suspended its exploration
activities in Bolivia in 2009. Subsequent to the year ended December 31, 2012, the Company decided to commence closure of its Bolivian
subsidiaries and not pay the patents due on the properties and consequently the Eskapa, El Desierto and Santa Isabel properties
were written off at December 31, 2012.  98
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  7.income tax
expense and deferred tax assets and liabilities A reconciliation of the expected
income tax recovery to the actual income tax recovery is as follows:   December 31,2012
    
    2011Net loss
    
    $
    (1,446,778)
    
    $
    (3,708,873)Statutory tax rate
    
    
    25.0%
    
    
    26.5%Expected income tax recovery at the statutory tax rate
    
    $
    (361,695)
    
    $
    (982,851)Non-deductible items and other
    
    
    (493,837)
    
    
    1,025,204Effect of change in tax rates
    
    
    141,782
    
    
    (65,588)Change in valuation allowance
    
    
    713,750
    
    
    23,235Income tax recovery
    
    $
    -
    
    $
    -   The Company has the following tax effected tax assets:    December 31,2012
    
    2011Non-capital loss carry-forwards
    
    
    $
    2,134,950
    
    $
    1,612,941Exploration and evaluation assets
    
    
    
    1,893,727
    
    
    1,689,019Equipment
    
    
    
    42,701
    
    
    43,326Other
    
    
    
    (10,956)
    
    
    1,3864,060,422
    
    
    3,346,672Valuation allowance
    
    
    
    (4,060,422)
    
    
    (3,346,672)Net deferred tax assets
    
    
    $
    -
    
    $
    -  99
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  7.income tax
expense and deferred tax assets and liabilities (CONTINUED) The tax pools relating to
these deductible temporary differences expire as follows:  Canadiannon-capitallosses2014
    
    
    
    
    
    
    $
    560,2142015
    
    
    
    
    
    
    
    566,5482026
    
    
    
    
    
    
    
    721,7542027
    
    
    
    
    
    
    
    877,9912028
    
    
    
    
    
    
    
    718,7012029
    
    
    
    
    
    
    
    629,1132030
    
    
    
    
    
    
    
    787,8002031
    
    
    
    
    
    
    
    897,6612032
    
    
    
    
    
    
    
    759,802$
    6,519,584  Chilean non-capital losses of $2,970,903, Canadian resources deductions of $5,597,594, Chilean resource deductions
of $21,046,895 and other tax pools of $193,032 can be carried forward indefinitely.  8.Share capital Authorized share capital Unlimited number of common
shares without par value. Unlimited number of Preferred
Shares - In addition to common shares, the Company’s authorized share capital includes preferred shares without par value,
none of which are issued. The board of directors is authorized, without further action by the shareholders, to issue preferred
shares in one or more series and to set the number of shares constituting any such series and the designation, rights, privileges,
restrictions and conditions attaching to the shares of such series including dividend rights and rates, redemption provisions (including
sinking fund provisions), rights of conversion or exchange, liquidation preferences and voting rights, if any. The preferred shares
as a class are entitled to priority over the common shares if the board of directors decides to pay any dividends, and, if the
Company is dissolved, liquidated or wound up, the preferred shares are entitled as a class to priority in respect of return of
capital. Except as required by law or the provisions of any designated series of preferred shares, the holders of preferred shares
as a class is not entitled to receive notice of, attend or vote at any meeting of the Company’s shareholders. 100
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  8.Share capital
(CONTINUED) Warrants  Balance
    
    
    
    Balance
    
    
    
    
    
    BalanceDec. 31,
    
    Issued/
    
    Dec. 31,
    
    Issued/
    
    
    
    Dec. 31,
    
    Exercise2010
    
    (Exercised)
    
    2011
    
    (Exercised)
    
    (Expired)
    
    2012
    
    Price
    
    Term to1,744,000
    
    
    (1,744,000)
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    $
    0.78
    
    Feb. 13 20121,282,500
    
    
    (1,282,500)
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    $
    0.70
    
    Apr. 15, 20112,871,250
    
    
    (2,250,000)
    
    
    621,250
    
    
    -
    
    
    (621,250)
    
    
    -
    
    $
    1.00
    
    Mar. 16, 20124,185,500
    
    
    (1,536,000)
    
    
    2,649,500
    
    
    (25,000)
    
    
    -
    
    
    2,624,500
    
    $
    0.20
    
    Mar. 24, 2014500,000
    
    
    (500,000)
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    $
    0.30
    
    Jun. 29, 20141,823,668
    
    
    -
    
    
    1,823,668
    
    
    -
    
    
    -
    
    
    1,823,668
    
    $
    0.35
    
    Jul. 8, 201417,583,720
    
    
    -
    
    
    17,583,720
    
    
    -
    
    
    -
    
    
    17,583,720
    
    $
    0.70
    
    Nov. 2, 201429,990,638
    
    
    (7,312,500)
    
    
    22,678,138
    
    
    (25,000)
    
    
    (621,250)
    
    
    22,031,888    As at December 31, 2012,
the weighted average remaining life of the share purchase warrants is 1.80 years and the weighted average exercise price of the
share purchase warrants is $0.61. During the year ended December
31, 2012, the Company extended the term of 1,823,668 warrants exercisable at $0.35 per share by two additional years from July
8, 2012 to July 8, 2014 and the term of 17,583,720 warrants exercisable at $0.70 per share by two additional years from November
1, 2012 to November 2, 2014. This resulted in incremental increases in the fair value of the warrants of $222,101 and $1,001,576
which have been charged to deficit during the year ended December 31, 2012. During the year ended December
31, 2011, the Company received approval to extend the term of 2,871,250 warrants at $1.00 per share by one additional year from
March 16, 2011 to March 16, 2012. This resulted in an incremental increase in the fair value of the warrants of $455,869 which
was charged to deficit during the year ended December 31, 2011. The change in the fair value
of the warrants was estimated using the Black-Scholes option pricing model using the following assumptions: 2012
    2011Risk-free interest rate
    1.36%-1.09%
    1.19%-1.79%Expected volatility
    108%-112%
    87%-106%Expected life
    2 years
    1-2 yearsDividend yield
    0%
    0% 101
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  8.Share capital
(CONTINUED) Stock options The Company maintains a
“rolling” incentive stock option plan (the “Plan”) which authorizes the issuance of common shares to qualified
option holders under the Plan. The Plan, which was approved by shareholders at the Annual General Meetings held on June 7, 2011
and October 1, 2012, authorizes the Board of Directors to grant options to purchase common shares of the Company to any person
who is an employee, director, officer, or consultant for the Company or one of its subsidiaries and who is not otherwise prevented
from receiving the Option under the terms of applicable policy of the TSX-V, or a company which is owned by one or more such individuals
(an “Eligible Person”). The maximum number of Common Shares which may be reserved for issuance under the Plan is 10%
of the Common Shares outstanding at the time of the grant (on a non-diluted basis) less the aggregate number of Common Shares reserved
for issuance under any other existing stock options or similar share compensation arrangement to persons who are eligible to receive
options under the Plan. The maximum number which may be reserved for issuance to any one person under the Plan is 5% (unless otherwise
approved by a majority of disinterested shareholders, which approval has not been sought or granted).  The Board is entitled,
subject to the requirements of applicable TSX-V policy, to set the exercise price of each option (provided it is greater than the
minimum prescribed under TSX-V Policy), the term during which it may be exercised (to a maximum of 10 years) and any vesting provisions
as they may deem appropriate and as are in compliance with TSX-V policy. Any options granted under the Plan are exercisable only
while the holder remains an Eligible Person or the time period determined by the Board after ceasing to be an Eligible Person,
and are not assignable or transferable other than by will or the laws of descent and distribution.  Balance
    
    
    
    Balance
    
    Granted
    
    BalanceDec. 31,
    
    Granted
    
    Dec. 31,
    
    (Expired) or
    
    Dec. 31,
    
    Exercise2010
    
    (Exercised)
    
    2011
    
    (Forfeited)
    
    2012
    
    Price
    
    Term to50,000
    
    
    -
    
    
    50,000
    
    
    (50,000)
    
    
    -
    
    $
    0.80
    
    Sep. 24, 2012-
    
    
    100,000
    
    
    100,000
    
    
    (100,000)
    
    
    -
    
    $
    1.40
    
    Dec. 4, 201260,000
    
    
    -
    
    
    60,000
    
    
    (60,000)
    
    
    -
    
    $
    0.70
    
    Dec. 20, 2012-
    
    
    100,000
    
    
    100,000
    
    
    (100,000)
    
    
    -
    
    $
    0.70
    
    Dec. 29, 201260,000
    
    
    -
    
    
    60,000
    
    
    -
    
    
    60,000
    
    $
    0.20
    
    Jan. 15, 2014110,000
    
    
    -
    
    
    110,000
    
    
    -
    
    
    110,000
    
    $
    0.35
    
    Jan. 29, 20151,955,000
    
    
    -
    
    
    1,955,000
    
    
    -
    
    
    1,955,000
    
    $
    0.40
    
    Apr. 20, 2015430,000
    
    
    -
    
    
    430,000
    
    
    -
    
    
    430,000
    
    $
    0.35
    
    Sep. 16, 20151,640,000
    
    
    -
    
    
    1,640,000
    
    
    -
    
    
    1,640,000
    
    $
    0.85
    
    May 2, 20161,170,000
    
    
    -
    
    
    1,170,000
    
    
    -
    
    
    1,170,000
    
    $
    0.84
    
    Feb. 23, 2017-
    
    
    -
    
    
    -
    
    
    100,000
    
    
    100,000
    
    $
    0.50
    
    Jun. 5, 20173,555,000
    
    
    (300,000)
    
    
    3,255,000
    
    
    -
    
    
    3,255,000
    
    $
    0.20
    
    Sep. 2, 2019-
    
    
    200,000
    
    
    200,000
    
    
    -
    
    
    200,000
    
    $
    0.70
    
    Jan. 6, 2021-
    
    
    2,425,000
    
    
    2,425,000
    
    
    (525,000)
    
    
    1,900,000
    
    $
    1.50
    
    May 2, 20219,030,000
    
    
    2,525,000
    
    
    11,555,000
    
    
    (735,000)
    
    
    10,820,000      102
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  8.Share capital (CONTINUED) Stock
options (continued) As at December 31, 2012, the
weighted average remaining contractual life of the options is 5.16 years and the weighted average exercise price of the options
is $0.65.  Stock-Based Compensation
– During the year ended December 31, 2012, the Company granted 100,000 stock options at $0.50 per share with a fair value
on the grant date of $26,891 which was capitalized to the Los Zorros Property exploration and evaluation assets. The following
assumptions were used for the Black-Scholes valuation of the stock options granted: Expected dividend rate – 0%; Expected
stock price volatility – 120%; Risk-free interest rate – 1.64%; Expected life of options – 5 years. During the year ended December
31, 2012, a total of 310,000 stock options expired with exercise prices ranging from $0.70 to $1.40. The expiries resulted in a
decrease of $217,883 in the share-based payment reserve. During the year ended December
31, 2012, a total of 525,000 stock options with an exercise price of $1.50 were forfeited. The forfeitures resulted in a decrease
of $671,540 in the share-based payment reserve. During the year ended December
31, 2011, the Company granted stock options to consultants, employees, directors and officers on a total of 2,825,000 shares at
$0.70 to $1.50 per share with fair values on the grant dates of $3,400,912 of which $2,626,421 was expenses in the statement of
comprehensive loss in the category “Stock-Based Compensation” and of which $774,491 was capitalized to the Los Zorros
Property exploration and evaluation assets.  9.Related party
transactions Professional fees
– A former director of the Company, provided legal services to us through Leschert & Company Law Corporation which charged
$204,147 (2011 - $65,982) for legal services during the year ended December 31, 2012. Consulting fees –
A former director of the Company, provided research and consulting services for the Company’s Board of Directors and charged
$6,000 (2011 - $2,800) for consulting services during the year ended December 31, 2012. Key management personnel
compensation – During the year ended December 31, 2012, salaries for employees who were also directors or officers of
the Company totalled $523,800 (2011 - $508,431), a $162,000 (2011 - $146,631) portion of which was capitalized to mineral exploration
assets. Extension of warrant
terms – During the year ended December 31, 2012, the terms of warrants were extended by two years on 861,834 warrants
with an exercise price of $0.35 per share and 10,164,000 warrants with an exercise price of $0.70 per share which are held by Sasan
Sadeghpour, a control person of the Company, who became a director on September 10, 2012. Reimbursement for legal
fees– During the year ended December 31, 2012, pursuant to a settlement agreement dated September 10, 2012, $50.000
was paid to Sasco Partners, LP, controlled by Sasan Sadeghpour, a director of the Company, to reimburse for legal fees. 103
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  10.Financial risk
management Financial Risk Management
- The Company is exposed in varying degrees to a variety of financial instrument related risks. Credit Risk –
Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party
to incur a financial loss. The Company’s primary exposure to credit risk is on its bank accounts. The Company’s bank
accounts are held with a major bank in Canada and a major bank in Chile which is a subsidiary of a major Canadian bank. The Company’s
cash is held by the major bank in Canada, and specific amounts are transferred to the bank in Chile as required to fund the Company’s
budgeted exploration activities in these countries. As the majority of the Company’s cash is held by one bank in Canada,
there is a concentration of credit risk. This risk is managed by using a major bank that is a high credit quality financial institution
as determined by rating agencies. Currency Risk - The
Company operates in Canada and Chile and is consequently exposed to foreign exchange risk arising from transactions denominated
in foreign currency. The Company has obligations and commitments in other currencies including the Chilean peso and the U.S. dollar.Fluctuations in foreign currency exchange rates may affect the Company’s results of operations and the value of the
Company’s foreign assets. The Company manages currency risk by closely monitoring relevant exchange rates and when possible,
executes currency exchange transactions at times when exchange rates are most advantageous for the Company. The Company does not
use hedging to manage its currency risk. The following is an analysis
of Canadian dollar equivalent of financial assets and liabilities that are denominated in Chilean pesos:  December 31,2012
    
    2011Cash
    
    
    
    
    
    $
    38,148
    
    $
    201,017Accounts receivable
    
    
    
    
    
    5,500
    
    
    4,110Accounts payable
    
    
    
    
    
    (124,644)
    
    
    (8,520)$
    (80,996)
    
    $
    196,607    As at December 31, 2012,
a 10% change in the Chilean peso to Canadian dollar exchange rate would impact the Company’s net loss by $8,100. Liquidity Risk -
Liquidity risk arises through the excess of financial obligations over available financial assets due at any point in time. The
Company’s objective in managing liquidity risk is to maintain sufficient readily available reserves in order to meet its
liquidity requirements at any point in time. The Company achieves this by maintaining sufficient cash. Historically, the Company's
sole source of funding has been the issuance of equity securities for cash, primarily through private placements. The Company’s
access to financing is always uncertain. There can be no assurance of continued access to significant equity funding. Price Risk –
The Company is exposed to price risk with respect to commodity prices, particularly gold, silver and copper. The Company monitors
commodity prices to determine the appropriate course of action to be taken by the Company. Interest Rate Risk
- Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. The Company
is not exposed to significant interest rate risk. 104
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  10.Financial risk
management (CONTINUED) Capital Management
- The Company identifies capital as cash and share capital. The Company raises capital through private placement and public share
offerings. Capital is managed in a manner consistent with the risk criteria and policies provided by the board of directors and
followed by management. All sources of financing are analyzed by management and approved by the board of directors. To maintain
or adjust its capital structure, the Company may issue new shares, acquire or dispose of assets or adjust the amount of cash. The
Company did not change its capital management policies during the year ended December 31, 2012. The Company’s primary
objectives when managing capital is to safeguard and maintain the Company’s financial resources for continued operations
and to fund expenditure programs to further advance mineral interests. The Company is able to scale its expenditure programs and
the use of capital to address market conditions by reducing expenditures and the scope of operations during periods of commodity
pricing decline and economic downturn. There are no externally imposed capital restrictions. Classification of financial
instruments-Financial assets included in the statements of financial position are as follows:  December 31,2012
    2011Cash
    2,756,359
    3,991,264Loans and recievablesOther receivables
    131,996
    166,538Financial assest classified at fair valuethrough profit or lossGold and silver bullion
    642,690
    5,807,3723,531,045
    9,918,174                                         Financial liabilities included
in the statements of financial position are as follows:   December 31,2012
    
    2011Non-derivative financial liabilitiesTrade payables and accrued liabilities
    
    
    
    
    $
    193,848
    
    $
    89,211   Fair value -The
fair value of the Company’s financial assets and liabilities approximates the carrying amount. Financial instruments measured
at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the
inputs used to estimate the fair values. The three levels of the fair value hierarchy are: ·Level 1 – Unadjusted quoted prices
in active markets for identical assets or liabilities (cash and gold and silver bullion are Level 1 financial instruments); ·Level 2 – Inputs other than quoted
prices that are observable for the asset or liability either directly or indirectly; and ·Level 3 – Inputs that are not based
on observable market data. 105
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  10.Financial risk management (CONTINUED)  The following is an analysis
of the Company’s financial assets measured at fair value as at December 31, 2012 and 2011:   As at December 31, 2012Level 1
    
    Level 2
    
    Level 3Cash
    
    $
    2,756,359
    
    $
    -
    
    $
    -Gold and silver bullion
    
    
    642,690
    
    
    -
    
    
    -$
    3,399,049
    
    $
    -
    
    $
    -As at December 31, 2011Level 1
    
    Level 2
    
    Level 3Cash
    
    $
    3,991,264
    
    $
    -
    
    $
    -Gold and silver bullion
    
    
    5,807,372
    
    
    -
    
    
    -$
    9,798,636
    
    $
    -
    
    $
    -   11.Segmented information The Company operates in
a single reportable operating segment – the acquisition, exploration and development of mineral properties. The Company’s equipment
and exploration and evaluations assets are located in the following geographic locations:  As at December 31, 2012Canada
    
    South America
    
    TotalEquipment
    
    
    $
    19,887
    
    $
    82,340
    $
    
    102,227Exploration and evaluation assets
    $
    -
    
    $
    18,139,082
    $
    
    18,139,082As at December 31, 2011Canada
    
    South America
    
    TotalEquipment
    
    
    $
    20,498
    
    $
    60,797
    
    $
    81,295Exploration and evaluation assets
    $
    -
    
    $
    12,397,911
    
    $
    12,397,911  106
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  11.Segmented information
(continued)  As at December 31, 2012Canada
    
    South America
    
    TotalEquipment
    
    
    $
    6,655
    
    $
    18,060
    
    $
    24,715Exploration and evaluation assets
    
    
    -
    
    
    5,271,122
    
    
    5,271,122$
    6,655
    
    $
    5,289,182
    
    $
    5,295,837As at December 31, 2011Canada
    
    South America
    
    TotalEquipment
    
    
    $
    12,926
    
    $
    88,583
    
    $
    101,509Exploration and evaluation assets
    
    
    -
    
    
    3,345,249
    
    
    3,345,249$
    12,926
    
    $
    3,433,832
    
    $
    3,446,758  The additions to the Company’s
equipment and exploration and evaluation assets were in the following geographic locations:   12.EVENTS AFTER THE REPORTING DATE  Severance totaling $1,341,734
was paid to employees and a consultant of the Company that were terminated pursuant to a change in management effected January
15, 2013. Options on a total of 750,000 shares at $1.50 per share were forfeited pursuant to the terminations.  Subsequent to the year ended
December 31, 2012, on April 2, 2013, U.S. $78,429 (CDN $79,590) was paid to Sasco Partners, LP, controlled by Sasan Sadeghpour,
a director of the Company, as a reimbursement for legal fees.  13.RESTATEMENT  During the year ended December
31, 2012, management concluded that the functional currency of Minera Samex Chile S.A. is the Chilean Peso and not the Canadian
dollar as it was previously designated to be, and accounted for this accordingly.  In consideration of the
effects of the difference in foreign exchange translation and to reflect the Chilean Peso being identified as the functional currency
of Minera.Samex Chile S.A., the consolidated statements of financial position as at December 31, 2011 and January 1, 2011 and the
consolidated statements of comprehensive loss and cash flows for the year ended December 31, 2011 have been restated to reflect
the Chilean peso as the functional currency of Minera Samex Chile S.A.  107
 
  SAMEX MINING CORP. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012 (EXPRESSED IN CANADIAN DOLLARS)  13.RESTATEMENT (CONTINUED)  The following adjustments
were made to the consolidated statement of financial position as at December 30, 2011: As previously stated
    
    Adjustment
    
    As restatedEquipment
    $
    110,917
    $
    (29,622)
    $
    81,295Exploration and evaluation assets
    
    13,625,896
    
    (1,227,985)
    
    12,397,911Reserves
    
    3,528,408
    
    1,617,029
    
    5,145,437Deficit
    $
    (32,996,161)
    $
    125,364
    $
    (32,870,797)  Total assets and total equity
decreased by $1,257,607 as at December 31, 2011.  The following adjustments
were made to the consolidated statement of financial position as at January 1, 2011: As previously stated
    
    Adjustment
    
    As restatedEquipment
    $
    56,445
    $
    (18,517)
    $
    37,928Exploration and evaluation assets
    
    10,299,789
    
    (231,418)
    
    10,068,371Reserves
    
    3,267,329
    
    (238,973)
    
    3,028,356Deficit
    $
    (28,695,092)
    $
    (10,963)
    $
    (28,706,055)  Total assets and total equity
decreased by $249,935 as at January 1, 2011.  The following adjustments
were made to the consolidated statement of comprehensive loss as at December 30, 2011: As previously stated
    
    Adjustment
    
    As restatedForeign exchange loss
    $
    (137,909)
    $
    136,328
    $
    (1,581)Translation loss
    $
    -
    $
    (1,143,999)
    $
    1,143,999  Total comprehensive loss
increased by $1,007,671 as at December 31, 2011. There was no change to loss per share due to the restatement as at December 31,
2011.  The following adjustments
were made to the consolidated statement of cash flow as at December 30, 2011: As previously stated
    
    Adjustment
    
    As restatedNet loss
    $
    (3,845,201)
    $
    136,328
    $
    (3,708,873)Effect of foreign exchange on cash
    $
    -
    $
    (32,763)
    $
    (32,763)      108
 
  
 ITEM 19. EXHIBITS.
  The following exhibits are filed as part of this Annual Report:
  1.1.
*Altered Memorandum of SAMEX (*previously filed as exhibit to Form 20-F Annual Report for the period ended November 30, 1995 (our “1995 Annual Report” on Form 20-F filed with the SEC);
  1.2.
*Change of Name Certificate for SAMEX (*previously filed with our 1995 Annual Report on Form 20-F filed with the SEC);
  1.3.
*Altered Articles of SAMEX (*previously filed as exhibit to Form 20-F Annual Report for the period ended November 30, 1998 (our “1998 Annual Report” on Form 20-F filed with the SEC);
  1.4.
*Altered Memorandum of SAMEX respecting the increase of authorized share capital (*previously filed with our 1998 Annual Report on Form 20-F filed with the SEC);
  1.5.
*Form of Notice of Articles of SAMEX issued by the Registrar of Companies for British Columbia on February 11, 2005 (*previously filed with our 2004 Annual Report on Form 20-F filed with the SEC);
  1.6.
*New Articles of SAMEX effective June 13, 2005 (*previously filed with our 2005 Annual Report on Form 20-F filed with the SEC);
  1.7.
*Form of Notice of Articles of SAMEX issued by the Registrar of Companies for British Columbia on June 13, 2005 (*previously filed with our 2005 Annual Report on Form 20-F filed with the SEC);
  4.1
*Settlement Agreement dated September 10, 2012 between Sasco Partners, LP and Sasan Sadeghpour, the Company, the Company's former board of directors, Peter J. Dahl, Jeffrey P. Dahl, Robert E. Kell, Larry D. McLean, Allen D. Leschert and Malcolm B. Fraser, Brenda McLean and Phil Southam (*previously furnished on Form 6-K with the SEC on September 13, 2012);
  4.2
Form of Advisory Agreement dated January 7, 2013 entered into between the Company and each of Jeffrey Dahl, Peter Dahl, Larry McLean, Brenda McLean, Rob Kell, Malcolm Fraser, Allen Leschert and Phil Southam;
  4.3
Consulting Agreement dated effective January 16, 2013 between the Company and Larry McLean;
  4.4
Consulting Agreement dated effective January 16, 2013 between the Company and Brenda McLean;
  4.5
Consulting & Confidentiality Agreement dated January 16, 2013 between Minera Samex Chile S.A. and Toro Taylor Y Compañia Limitada.
  4.6
Stock Option Plan (filed as Exhibit 4.19 to the Company's Annual Report on Form 20-F filed with the SEC on May 30, 2003);
  8.1
Our subsidiaries. See also Item 4. A. History and Development Of The Company;
  12.1
Certification of Chief Executive Officer under Rule 13a-4(a);
  12.2
Certification of Chief Financial Officer under Rule 13a-4(a);
  13.1
Sarbanes Oxley 906 Certification of Chief Executive Officer;
  13.2
Sarbanes Oxley 906 Certification of Chief Financial Officer
  The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
  Date: April 30, 2013
 
 SAMEX Mining Corp.“Sasan Sadeghpour”


“Larry D. McLean”Sasan Sadeghpour, Interim Chief Executive Officer


Larry D. McLean, Interim Chief Financial Officer
 109




Exhibit 4.2

ADVISORY AGREEMENT



This Agreement
is made as atJanuary 7, 2013(the “Effective Date”)



BETWEEN

SAMEX
MINING CORP., a corporation incorporated under the laws of British Columbia and having an office at 301-32920 Ventura
Avenue, Abbotsford, B.C. V2S 6J3(the “Company”)
(tel: 604-870-9920 ) (fax: 604-870-9930)

| | AND | 
| | --- | 

| |  | ________________________, of
 _____________________(the "Advisor"). (tel: ) (email:_____________________)
| |  | ---------------------------------------------------------------------------------------------------------



WHEREAS

A.	The Advisor is a former director, officer
and/or senior employee of the Company and has extensive professional, personal or business experience which may be helpful to the
Company and its management in mineral exploration and other activities;



B.As a result of the terms of the
Settlement Agreement dated September 10, 2012 between the Company and Sasco Partners, LP et al, the Advisor has ceased to act in
his former capacity as a director, officer and/or senior employee of the Company and the Company has or anticipates hereafter making
certain changes to its Board and/or management team to reflect such event;



C.
The Company wishes to retain the Advisor
as an advisor to the Company's Board and senior management team, to among other things, assist the Company with respect to its
transition in management; and



D.
The Advisor wishes to provide services
to the Company in that capacity.



THEREFORE the parties hereto agree as
follows:



1.SERVICES



| | 1.1. | The Advisor will advise the Company's management, employees and agents, at reasonable times, in
matters related to the Company's mining exploration and other business activities, as requested by the Company (the "Company's
Business") that pertain to areas within the Advisor's area of expertise or knowledge with respect to the Advisor's former
position with the Company.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 1.2. | During the term of this Agreement, the Advisor will provide up to 1 hour of consultation, information
and advice within the Advisor’s area of expertise per month at such times as may be mutually convenient for the Company and
the Advisor (the "Minimum Consultation") in consideration for continuation of the previously granted stock options referred
to in section 3 below and shall provide such additional time as may be reasonably necessary to permit an orderly and efficient
transition and transfer of knowledge between the Advisor and such individual or individuals who have assumed the position(s) formerly
held by the Advisor in consideration for payment such reasonable fee in such amount and on such terms and conditions as the Advisor
and the Company may agree to, acting reasonably.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 1.3 | Consultation may be sought by the Company over the telephone, by email, in person at the Advisor's
office, at the Company's offices or another reasonable location or through written correspondence, and will involve reviewing activities
and developments in the Company's Business and
may also involve participation in meetings or conference calls with the Board of Directors or other members of Company management.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

110











| | 1.4 | Nothing herein will limit or affect arrangements under any other agreement between the Advisor
and the Company or any of its subsidiaries including, without limitation, any agreement to provide services on an ongoing or special
project basis all of which shall be governed under the terms of such agreement or arrangement.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2. | EXPENSES REIMBURSEMENTS. Reasonable expenses of the Advisor incurred at the request of the
Company or pre-approved by the Company will be reimbursed promptly by the Company, subject to customary verification.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 3. | STOCK OPTION PLAN. In consideration for the Advisor agreeing to enter into this Agreement
and provide the Minimum Consultation hereunder, the Advisor shall continue to hold and have full rights to the outstanding un-exercised
stock options granted to the Advisor by the Company currently and held by the Advisor, save and except for those options which
have been or which may hereafter be voluntarily cancelled by the Advisor, particulars of which are set out on Schedule "A"
hereto. Notwithstanding anything to the contrary contained in any agreement, including but not limited to any option agreement,
the Advisor hereby acknowledges and agrees that any stock option of the Company held by the Advisor on the date of termination
of this Agreement shall (i) cease to be exercisable and (ii) shall automatically be cancelled by the Company, on the date that
is 90 days after the termination of this Agreement.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | TERM The term of this Agreement will begin on the Effective Date of this Agreement and will
end 24 months thereafter, unless termination earlier as provided below or extended later by mutual agreement of the parties (the
"Term"). This Agreement may not be terminated prior to expiry of the initial 24 month Term except by written consent
of the Advisor. Upon termination, all outstanding expenses accrued and unpaid to the date of termination will be made and will
be paid in accordance with Section 2 of this Agreement.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 5. | CERTAIN OTHER CONTRACTS
| | -- | -----------------------



| | 5.1. | During the Term, the Advisor shall devote only such portion of his or her time, attention and abilities
to the Company's Business as is reasonably necessary for the proper exercise of his Minimum Consultation duties (or, where mutually
agreed by the parties, such additional duties) pursuant to this Agreement. Nothing contained herein shall be deemed to require
the Advisor to devote his or her exclusive time, attention and ability to the Company's Business.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 5.2. | The Advisor will not disclose to the Company any information that the Advisor is obligated to keep
secret pursuant to an existing confidentiality agreement with a third party, and nothing in this Agreement will impose any obligation
on the Advisor to the contrary.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 5.3 | The Advisor has disclosed and, during the Term, will disclose to the Chairman of the Board of Directors
any conflicts in the Advisor's duties under this Agreement and any other duties to other companies or any other agreement binding
on the Advisor.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6. | CONFIDENTIALITY
| | -- | ---------------



| | 6.1. | The Advisor acknowledges that, during the course of performing his services hereunder, the Company
will be disclosing information to the Advisor, and the Advisor will be developing information pertaining to mineral properties
and business opportunities in which the Company has an interest or is seeking to acquire including, without limitation, geological
information, technical reports, maps, samples, assays, drill core, geophysical surveys, results of exploration or other information
pertaining to any such property, together with any reports, documents, concepts, products
and processes, information pertaining to prospective property vendors, business or financing contacts, or information pertaining
to prospective property acquisitions or other business opportunities including acquisitions, joint ventures or business combinations
or other business opportunities prepared, produced, developed, or acquired, directly or indirectly or otherwise developed or first
reduced to practice by or at the direction of the Company, its employees, agents or consultants, or by the Advisor in connection
with or in the course of providing the Minimum Consultation pursuant to this Agreement and pertaining to the Company’s Business
(collectively, the “Confidential Information”). The Advisor acknowledges and agrees that all Confidential Information
shall belong exclusively to and shall be the sole property of the Company and the Company shall be entitled to all right, title
and interest therein, and all profits, or benefits therefrom. No copies, summaries or other reproductions of any Confidential Information
shall be made by the Advisor without the express permission of the Company. The Advisor acknowledges that the Company's business
is extremely competitive; dependent in part upon the maintenance of secrecy, and that any disclosure of the Confidential Information
would result in serious harm to the Company.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

111











| | 6.2. | The Advisor agrees that the Confidential Information will be used by the Advisor only in connection
with his activities hereunder, and will not be used in any way that is detrimental to the Company.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6.3. | The Advisor agrees not to disclose, directly or indirectly, the Confidential Information to any
third person or entity, other than representatives or agents of the Company. The Advisor will treat all such information as confidential
and proprietary property of the Company.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6.4. | The term "Confidential Information" does not include information that (i) is or becomes
generally available to the public other than by disclosure in violation of this Agreement, (ii) becomes available to the relevant
party on a non-confidential basis, or (iii) was independently developed by the relevant party without reference to the information
provided by the Company.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6.5. | The Advisor may disclose any Confidential Information that is required to be disclosed by law,
government regulation or court order. If disclosure is required, the Advisor will give the Company advance notice so that the Company
may seek a protective order or take other action reasonable in light of the circumstances.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6.6. | Upon termination of this Agreement, the Advisor will promptly return to the Company all materials
containing Confidential Information as well as data, records, reports and other property, furnished by the Company to the Advisor
or produced by the Advisor in connection with services rendered hereunder, together with all copies of any of the foregoing. Notwithstanding
such return, the Advisor shall continue to be bound by the terms of the confidentiality provisions contained in this Section 6
for a period of two years after the termination of this Agreement.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 7. | NO CONFLICT: VALID AND BINDING The Advisor represents that neither the execution of this
Agreement nor the performance of the Advisor's obligations under this Agreement (as modified to the extent required by Section
5) will result in a violation or breach of any other agreement by which the Advisor is bound. The Company represents that this
Agreement has been duly authorized and executed and is a valid and legally binding obligation of the Company, subject to no conflicting
agreements. The Advisor acknowledges that he has read and fully understands this Agreement, and has received independent legal
advice with respect to its rights hereunder.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 8. | NOTICES Any notice provided under this Agreement shall be in writing and shall be deemed
to have been effectively given (i) upon receipt when delivered personally, (ii) one day after sending when sent by express mail
service or Federal Express, or (iii) 5 days after sending when sent by regular mail to the address set out on the first page of
this Agreement or to other such address as may have been
designated by the Company or the Advisor by notice to the other given as provided herein.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

112











| | 9. | INDEPENDENT CONTRACTOR: WITHHOLDING The Advisor will at all times be an independent contractor,
and as such will not have authority to bind the Company. The Advisor will not act as an agent nor shall he be deemed to be an employee
of the Company for the purposes of any employee benefit program, unemployment benefits, or otherwise. The Advisor shall not enter
into any agreements or incur any obligations on behalf of the Company. The Advisor represents that he is in business for himself
and is an independent contractor for purposes of the Income Tax Act (Canada). In the event the Canada Revenue Agency or any other
applicable authority, for whatever reason, seeks from the Company or any and all director(s) of the Company, Taxes with respect
to any amounts paid under this Agreement, the Advisor agrees to indemnify the Company and the directors of the Company, the amount
of any such Taxes (including applicable interest and fines thereon) within 30 days after any such Taxes are payable by the Company.
"Taxes" means federal and provincial income tax, Canada Pension Plan, Employment Insurance, GST or other similar source
deductions or contributions.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10. | ASSIGNMENT Due to the personal nature of the services to be rendered by the Advisor, the
Advisor may not assign this Agreement. The Company may assign all rights and liabilities under this Agreement (as a group with
other similar agreements with members of the Advisory Board) to a subsidiary or an affiliate or to a successor to all or a substantial
part of its business and assets without the consent of the Advisor. Subject to the foregoing, this Agreement will enure to the
benefit of and be binding upon each of the heirs, assigns and successors of the respective parties.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 11. | SEVERABILITY If any provision of this Agreement shall be declared invalid, illegal or unenforceable,
such provision shall be severed and the remaining provisions shall continue in full force and effect.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 12. | REMEDIES The Advisor acknowledges that the Company would have no adequate remedy at law
to enforce Section 6 hereof. In the event of a violation by the Advisor of such Section, the Company shall have the right to obtain
injunctive or other similar relief, as well as any other relevant damages, without the requirement of posting bond or other similar
measures.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 13. | GOVERNING LAW; ENTIRE AGREEMENT; AMENDMENT
This Agreement shall be governed by the laws of the Province of British Columbia, Canada. The provisions herein contained constitute
the entire agreement between the parties and supersede all previous communications, representations and agreements, whether oral
or written, between the parties with respect to the subject matter hereof and may only be amended by
both parties in writing.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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



|ADVISOR:                         |  | COMPANY:                                                                               
|-------------------------------- |  | ---------------------------------------------------------------------------------------
|________________________________ |  | SAMEX MINING CORP.:
        
        By:__________________
        Authorized signatory
|Date:__________________          |  | Date:__________________                                                                





113









Schedule "A"



Stock Options Retained by the Advisor





|Date of Option | Number of Shares | Exercise Price | Option Expiry Date
|-------------- | ---------------- | -------------- | ------------------
|               |                  |                |                   
|               |                  |                |                   



114









Exhibit 4.3



CONSULTING
AGREEMENT



THIS AGREEMENT dated for reference January
16, 2013.



BETWEEN:



Larry D. McLean,



(hereinafter called the "Consultant")

OF THE FIRST PART

AND:



SAMEX
MINING CORP., a corporation incorporated under the laws of British Columbia and having an office at 301-32920 Ventura
Avenue, Abbotsford, B.C. V2S 6J3



(hereinafter called the “Company”)

OF THE SECOND PART



WHEREAS:



| | A. | The Company wishes to acquire and the Consultant
wishes to supply the services described herein upon the terms and conditions set out in this Agreement;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | B. | The Consultant acknowledges that in the
performance of the services contemplated by this Agreement he will create or be privy to confidential information which is valuable
to the Company; and
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | C. | There may exist previous agreements between
the Company and the Consultant.
| | -- | ---------------------------------------------------------------------------



NOW THEREFORE THIS AGREEMENT WITNESSES
that in consideration of the mutual premises and covenants contained in this Agreement, the parties hereto covenant and agree as
follows:



| | 1. | Provision of Services
| | -- | ---------------------

1.1Subject to the terms of this Agreement, the Consultant agrees to
serve as Interim Chief Financial Officer of the Company during the term of this Agreement (the “Term”) and to perform
all of the usual duties associated with such office, including coordinating preparation of financial statements, annual and quarterly
reports, financial books and records and coordinating annual audit of the Company for the fiscal year ending December 31, 2012
and such other services as are necessarily incidental thereto that may be required by the Company (the "Services").

1.2The Consultant shall use his best efforts to further the interests
of the Company in providing the Services.

1.3The Consultant agrees that he will not be entitled to receive any
additional benefits or compensation for the performance of such duties from the Company.

1.4The Consultant shall report to and receive directions from the Interim
Chief Executive Officer (Sasan Sadeghpour).

115







| | 2. | Changes in Conditions of Service
| | -- | --------------------------------

2.1	The Company shall be entitled to order reasonable changes
and/or deletions from the Services by giving written notice to the Consultant without invalidating this Agreement. The Consultant
shall be deemed to have agreed to such changes and/or deletions and the Services to be provided hereunder shall be modified accordingly.

| | 3. | Remuneration of Consultant
| | -- | --------------------------

3.1In consideration of the Consultant's performance of the Services
as required by this Agreement, the Company shall pay the Consultant the following remuneration:

| | (a) | the sum of $9,500 (CDN) per month ($438
per diem) payable on the last day of each month during the Term of this Agreement (“Fees”);
| | --- | -----------------------------------------------------------------------------------------------------------------------------------

| | (b) | subject to such reasonable restrictions
and requirements as the Company may impose on its consultants and employees generally from time to time, the Company shall reimburse
the Consultant for out-of-pocket expenses incurred in performance of the services upon receipt of such evidence of those expenses
as the Company may reasonably require (“Expenses”);
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3.2The Consultant shall be entitled to remuneration on Termination
as set out in section 12.

| | 4. | Consultant Not Agent or Employee
| | -- | --------------------------------

4.1The Consultant is not the employee or agent of the Company and accordingly,
shall not purport to enter into any a contract or subcontract on behalf of the Company or otherwise purport to act on its behalf
except where authorized in writing or in his capacity as Interim Chief Financial Officer. Nothing in this Agreement shall be deemed
to require the Consultant to provide his services exclusively to the Company and the Consultant hereby acknowledges that the Company
shall not be required to make any remittances or payments required of employers by statute on the Consultant's behalf and the Consultant
shall not be entitled to the fringe benefits provided by the Company to its employees.

4.2The Company acknowledges that since the Consultant is an independent
contractor and not an employee of the Company, the Consultant shall have direction and control of the manner, methods, techniques
and procedures used by the Consultant to perform the Services.

4.3Notwithstanding the foregoing, nothing herein shall limit or affect
any fiduciary or other duty at law applicable to the Consultant arising from his appointment or function as Interim Chief Financial
Officer of the Company.

| | 5. | Facilities
| | -- | ----------

5.1The Company shall provide all the facilities (including office space,
typing, document reproduction, computer programming and other clerical assistance) that may be required by the Consultant to perform
the Services.

| | 6. | Books and Records
| | -- | -----------------

6.1The Consultant shall keep proper accounts and records of all expenditures
made in connection with the Services, and of the time expended by the Consultant in performing the Services and all invoices, receipts
and vouchers relating thereto.

| | 7. | Company's Obligations
| | -- | ---------------------

7.1The Company shall make available to the Consultant such information
and data and shall permit the Consultant to have access to such documents or premises as are reasonably necessary to enable the
Consultant to perform the Services.

116







| | 8. | Confidentiality and Ownership of
Work Product
| | -- | ---------------------------------------------

8.1All information pertaining to mineral properties in which the Company
has an interest or is seeking to acquire including, without limitation, any mineral property introduced to the Company by the Consultant
within 12 months prior to any particular date which is not rejected in writing by the Company, including, without limitation, any
geological information, technical reports, maps, samples, assays, drill core, geophysical surveys, results of exploration or other
information pertaining to any such property, together with any reports, documents, concepts, products and processes, information
pertaining to prospective property vendors, business or financing contacts, or information pertaining to prospective property or
other acquisitions, joint ventures or business combinations or any business opportunities prepared, produced, developed, or acquired,
by or at the direction of the Consultant, directly or indirectly, in connection with or otherwise developed or first reduced to
practice by the Consultant in the course of performing Services pursuant to this Agreement and pertaining to the Company’s
business (collectively, the “Work Product”) shall belong exclusively to and shall be the sole property of the Company
and the Company shall be entitled to all right, title and interest therein, and all profits, or benefits therefrom. No copies,
summaries or other reproductions of any Work Product shall be made by the Consultant without the express permission of the Company
and the Consultant shall, forthwith upon the Company’s request, deliver to the Company all Work Product in the possession
of or otherwise available to or under the control of the Consultant notwithstanding a termination of this Agreement

8.2The Consultant shall not at any time either during the term of this
Agreement or thereafter divulge to any person, firm or corporation, any information, documents or Work Product (other than information,
documents or Work Product which the Company has authorized for public disclosure or which has previously been disclosed to the
public) received by the Consultant during the course of providing the Services to the Company with regard to the personal, financial
or other affairs of the Company or any of its subsidiaries, or the Company’s directors, officers and employees and all such
information shall be kept confidential and shall not in any manner be revealed to anyone by the Consultant, except as may be required
by law or otherwise permitted by the Company in writing.

8.3The Consultant shall comply, and shall take proper measures to cause
any agents or employees of the Consultant or other persons under the Consultant’s direction or control to comply, with such
directions as the Company shall make to ensure the safeguarding or confidentiality of all such information, documents, and Work
Product.

| | 9. | Duties of Consultant
| | -- | --------------------

9.1During the Term of this Agreement, the Consultant shall devote such
of his time, attention and abilities to the business of the Company as is reasonably necessary for the proper exercise of his duties
pursuant to this Agreement. Nothing contained herein shall be deemed to require the Consultant to devote his exclusive time, attention
and ability to the business of the Company.

9.2During the Term of this Agreement, the Consultant shall:

| | (a) | at all times except when disabled by sickness
or incapacity, faithfully and diligently perform his duties as Interim Chief Financial Officer and use his best efforts to promote
and advance the business of the Company in that capacity;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | devote such of his time, labour and attention
to the business of the Company as is necessary for the proper exercise of the Consultant's duties hereunder and, except as otherwise
provided herein, refrain from engaging in any business, venture, or other commercial or sales activities that in any material way
conflicts with or detracts from his ability to fulfill his duties in the manner contemplated in this paragraph; and
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | refrain from acting in any manner contrary
to the interests of the Company or contrary to the duties of the Consultant as contemplated herein.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------

| | 10. | Liability of Consultant
| | --- | -----------------------

10.1The Consultant shall indemnify and save the Company harmless from
and against all costs, expenses, losses, damages and obligations it may suffer or incur as the result of the breach of any covenant
or warranty made by the Consultant in this Agreement.

117







| | 11. | Termination
| | --- | -----------

11.1The term of this Agreement shall be for 3 1/2 months or such longer
period as may be provide for herein (the “Term”) and shall commence upon January 16, 2013 and unless terminated earlier
pursuant to the provisions hereof, or unless renewed in writing by the parties, shall expire on April 30, 2013.

11.2This Agreement may be terminated prior to the completion of the
Services (“Termination”) upon written notice given:

| | (a) | by the Consultant:
| | --- | ------------------

| | (i) | upon 30 days' prior written notice;
| | --- | -----------------------------------

| | (ii) | upon the occurrence of an Event of Default
by the Company as set out in clause 11.4(b);
| | ---- | ---------------------------------------------------------------------------------------

| | (b) | by the Company:
| | --- | ---------------

| | (i) | upon 30 days' prior written notice;
| | --- | -----------------------------------

| | (ii) | upon the occurrence of an Event of Default
by the Consultant as set out in clause 11.4 (a).
| | ---- | -------------------------------------------------------------------------------------------

11.3If either party fails to give any such notice, this Agreement shall
continue in full force and effect.

11.4An event of default of this Agreement (“Event of Default”)
shall be deemed to occur:

| | (a) | by the Consultant if he:
| | --- | ------------------------

| | (i) | is in breach of any covenant, obligation
or warranty hereunder and such breach continues for a period of seven (7) days after written notice thereof by the Company to the
Consultant;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (ii) | becomes unable to perform his duties hereunder
due to the Consultant’s death or any illness or physical or mental incapacity that continues for not less than thirty (30)
consecutive days;
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | by the Company if it:
| | --- | ---------------------

| | (i) | is in breach of any covenant, obligation
or warranty hereunder and such breach continues for a period of seven (7) days after written notice thereof by the Consultant to
the Company; or
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (ii) | becomes insolvent or is unable to discharge
its liabilities generally as they become due, makes an assignment for the benefit of its creditors, or is made subject to a petition
or other proceedings in bankruptcy.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

11.5Notwithstanding the termination of this Agreement or any other provision
herein, the covenants and obligations under section 8 hereof or contained in any agreement delivered hereunder with respect to
the use of confidential information, work product or non-competition with the Company shall remain in full force and effect for
a period of twelve (12) months thereafter.

| | 12. | Remuneration Payable on Termination
| | --- | -----------------------------------

12.1Notwithstanding any other provision herein, in the event of Termination,
the Company shall pay to the Consultant all amounts of Fees and Expenses accruing hereunder up to and including the effective date
of Termination.

12.2Without limiting the generality of the foregoing, if this Agreement
is Terminated, the Company shall not be obligated to pay any severance, retiring allowance, termination
bonus or any other amount other than as provided for in section 12.1.

118









| | 13. | Non-Assignability
| | --- | -----------------



13.1The Consultant shall not subcontract to any person, any right, duty
or obligation hereunder without the prior written consent of the Company. This Agreement may not be assigned by either party without
the prior written consent of the other party.

| | 14. | Co-operation with Other Parties
| | --- | -------------------------------

14.1The Consultant shall co-operate with all other parties engaged
or employed by the Company from time to time and shall coordinate his activities with the activities of such parties as and when
requested by the Company.

| | 15. | Force Majeure
| | --- | -------------



15.1Notwithstanding anything herein to the contrary, neither party hereto
shall be deemed to be in default with respect to the performance of the terms, covenants and conditions of this Agreement if the
same shall be due to any strike, lock-out, civil commotion, invasion, rebellion, hostilities, sabotage, governmental regulations
or controls, or acts of God.

| | 16. | Notice
| | --- | ------

16.1All notices, demands and payments required or permitted to be given
hereunder shall be in writing and may be delivered personally, or sent by telefax or other means of electronic communication providing
a printed copy ("Electronic Communication") or may be forwarded by first class prepaid registered mail to the addresses
set forth as set out on the first page of this Agreement. Any notice delivered or sent by Electronic Communication shall be deemed
to have been given and received at the time of delivery. Any notice mailed as aforesaid shall be deemed to have been given and
received on expiration of 72 hours after it is posted, addressed to the Company or the Consultant at their respective addresses
or telefax numbers set out above or such other address or addresses or telefax numbers as the parties may from time to time give
notice of in writing; provided that if there shall be between the time of mailing and the actual receipt of the notice a mail
strike, slow down or other labour dispute which may affect the delivery of such notice by the mails, then such notice shall be
effective only if actually delivered.

| | 17. | Entire Agreement
| | --- | ----------------



17.1The provisions herein contained constitute the entire agreement
between the parties and supersede all previous communications, representations and agreements, whether oral or written, between
the parties with respect to the subject matter hereof.

| | 18. | Further Assurances
| | --- | ------------------

18.1Each of the parties shall execute such other documents and instruments
and shall do such other acts as may be necessary to implement and carry out the intent of this Agreement.

| | 19. | Proper Law, Attornment and Venue
| | --- | --------------------------------



19.1This Agreement will be governed by and construed in accordance
with the laws of British Columbia. The Company and the Consultant hereby attorn to jurisdiction the Courts thereof and hereby
select Vancouver, British Columbia as the proper forum for any action commenced by any party with respect to this Agreement or
the transactions contemplated herein.

| | 20. | Time of Essence
| | --- | ---------------



20.1Time is of the essence of this Agreement.

119









| | 21. | Waiver of Breach
| | --- | ----------------



21.1The waiver by either the Company or the Consultant of a breach of
any provisions of this Agreement by the other party to this Agreement shall not operate or be construed as a waiver of any subsequent
breach by that party.

| | 22. | Regulatory Approval
| | --- | -------------------



22.1This Agreement is subject to the approval of all regulatory authorities
as may have jurisdiction (the "Regulatory Authorities").



IN WITNESS WHEREOF the parties have affixed
their common seal hereto in the presence of their officers duly authorized for that purpose.





|The corporate seal ofSAMEX MINING CORP.                 | )                                                                                                                                                                     |    
|------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---
|was hereunto affixed in the presence of:                | )                                                                                                                                                                     |    
|"Sasan Sadeghpour"
        Authorized
        Signatory | )
                                                                                )
                                                                                ) | c/s
|"Larry D. McLean"
        Authorized Signatory          | )
                                                                                )                                                                                   |    





|SIGNED, SEALED AND DELIVERED by
        Larry
        D. McLean
        _________________________________________ | )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                ) | 
|----------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|in
the presence of:_________________________________________                                                      | "Larry D. McLean"
        Larry D. McLean                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Name
of Witness_________________________________________                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Address
of Witness_________________________________________Occupation of Witness                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    





120









Exhibit
4.4

CONSULTING
AGREEMENT



THIS AGREEMENT dated for reference January
16, 2013.



BETWEEN:



Brenda McLean,



(hereinafter called the "Consultant")

OF THE FIRST PART

AND:



SAMEX
MINING CORP., a corporation incorporated under the laws of British Columbia and having an office at 301-32920 Ventura
Avenue, Abbotsford, B.C. V2S 6J3



(hereinafter called the “Company”)

OF THE SECOND PART



WHEREAS:



| | D. | The Company wishes to acquire and the Consultant
wishes to supply the services described herein upon the terms and conditions set out in this Agreement;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | E. | The Consultant acknowledges that in the
performance of the services contemplated by this Agreement she will create or be privy to confidential information which is valuable
to the Company; and
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | F. | There may exist previous agreements between
the Company and the Consultant.
| | -- | ---------------------------------------------------------------------------



NOW THEREFORE THIS AGREEMENT WITNESSES
that in consideration of the mutual premises and covenants contained in this Agreement, the parties hereto covenant and agree as
follows:



| | 23. | Provision of Services
| | --- | ---------------------

23.1Subject to the terms of this Agreement, the Consultant agrees to
serve as Interim Corporate Secretary of the Company during the term of this Agreement (the “Term”) and to perform all
of the usual duties associated with such office and such other services as are necessarily incidental thereto that may be required
by the Company (the "Services").

23.2The Consultant shall use her best efforts to further the interests
of the Company in providing the Services.

23.3The Consultant agrees that she will not be entitled to receive any
additional benefits or compensation for the performance of such duties from the Company.

23.4The Consultant shall report to and receive directions from the Interim
Chief Financial Officer (Larry D. McLean).

121







| | 24. | Changes in Conditions of Service
| | --- | --------------------------------

2.1	The Company shall be entitled to order reasonable changes
and/or deletions from the Services by giving written notice to the Consultant without invalidating this Agreement. The Consultant
shall be deemed to have agreed to such changes and/or deletions and the Services to be provided hereunder shall be modified accordingly.

| | 25. | Remuneration of Consultant
| | --- | --------------------------

25.1In consideration of the Consultant's performance of the Services
as required by this Agreement, the Company shall pay the Consultant the following remuneration:

| | (a) | the sum of $5,900 (CDN) per month ($340
per dieum) payable on the last day of each month during the Term of this Agreement (“Fees”);
| | --- | ------------------------------------------------------------------------------------------------------------------------------------

| | (b) | subject to such reasonable restrictions
and requirements as the Company may impose on its consultants and employees generally from time to time, the Company shall reimburse
the Consultant for out-of-pocket expenses incurred in performance of the services upon receipt of such evidence of those expenses
as the Company may reasonably require (“Expenses”);
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

25.2The Consultant shall be entitled to remuneration on Termination
as set out in section 12.

| | 26. | Consultant Not Agent or Employee
| | --- | --------------------------------

26.1The Consultant is not the employee or agent of the Company and accordingly,
shall not purport to enter into any a contract or subcontract on behalf of the Company or otherwise purport to act on its behalf
except where authorized in writing or in her capacity as Interim Corporate Secretary. Nothing in this Agreement shall be deemed
to require the Consultant to provide her services exclusively to the Company and the Consultant hereby acknowledges that the Company
shall not be required to make any remittances or payments required of employers by statute on the Consultant's behalf and the Consultant
shall not be entitled to the fringe benefits provided by the Company to its employees.

26.2The Company acknowledges that since the Consultant is an independent
contractor and not an employee of the Company, the Consultant shall have direction and control of the manner, methods, techniques
and procedures used by the Consultant to perform the Services.

26.3Notwithstanding the foregoing, nothing herein shall limit or affect
any fiduciary or other duty at law applicable to the Consultant arising from her appointment or function as Interim Corporate Secretary
of the Company.

| | 27. | Facilities
| | --- | ----------

27.1The Company shall provide all the facilities (including office space,
typing, document reproduction, computer programming and other clerical assistance) that may be required by the Consultant to perform
the Services.

| | 28. | Books and Records
| | --- | -----------------

28.1The Consultant shall keep proper accounts and records of all expenditures
made in connection with the Services, and of the time expended by the Consultant in performing the Services and all invoices, receipts
and vouchers relating thereto.

| | 29. | Company's Obligations
| | --- | ---------------------

29.1The Company shall make available to the Consultant such information
and data and shall permit the Consultant to have access to such documents or premises as are reasonably necessary to enable the
Consultant to perform the Services.

122







| | 30. | Confidentiality and Ownership of
Work Product
| | --- | ---------------------------------------------

30.1All information pertaining to mineral properties in which the Company
has an interest or is seeking to acquire including, without limitation, any mineral property introduced to the Company by the Consultant
within 12 months prior to any particular date which is not rejected in writing by the Company, including, without limitation, any
geological information, technical reports, maps, samples, assays, drill core, geophysical surveys, results of exploration or other
information pertaining to any such property, together with any reports, documents, concepts, products and processes, information
pertaining to prospective property vendors, business or financing contacts, or information pertaining to prospective property or
other acquisitions, joint ventures or business combinations or any business opportunities prepared, produced, developed, or acquired,
by or at the direction of the Consultant, directly or indirectly, in connection with or otherwise developed or first reduced to
practice by the Consultant in the course of performing Services pursuant to this Agreement and pertaining to the Company’s
business (collectively, the “Work Product”) shall belong exclusively to and shall be the sole property of the Company
and the Company shall be entitled to all right, title and interest therein, and all profits, or benefits therefrom. No copies,
summaries or other reproductions of any Work Product shall be made by the Consultant without the express permission of the Company
and the Consultant shall, forthwith upon the Company’s request, deliver to the Company all Work Product in the possession
of or otherwise available to or under the control of the Consultant notwithstanding a termination of this Agreement

30.2The Consultant shall not at any time either during the term of this
Agreement or thereafter divulge to any person, firm or corporation, any information, documents or Work Product (other than information,
documents or Work Product which the Company has authorized for public disclosure or which has previously been disclosed to the
public) received by the Consultant during the course of providing the Services to the Company with regard to the personal, financial
or other affairs of the Company or any of its subsidiaries, or the Company’s directors, officers and employees and all such
information shall be kept confidential and shall not in any manner be revealed to anyone by the Consultant, except as may be required
by law or otherwise permitted by the Company in writing.

30.3The Consultant shall comply, and shall take proper measures to cause
any agents or employees of the Consultant or other persons under the Consultant’s direction or control to comply, with such
directions as the Company shall make to ensure the safeguarding or confidentiality of all such information, documents, and Work
Product.

| | 31. | Duties of Consultant
| | --- | --------------------

31.1During the Term of this Agreement, the Consultant shall devote such
of her time, attention and abilities to the business of the Company as is reasonably necessary for the proper exercise of her duties
pursuant to this Agreement. Nothing contained herein shall be deemed to require the Consultant to devote her exclusive time, attention
and ability to the business of the Company.

31.2During the Term of this Agreement, the Consultant shall:

| | (a) | at all times except when disabled by sickness
or incapacity, faithfully and diligently perform her duties as Interim Corporate Secretary and use her best efforts to promote
and advance the business of the Company in that capacity;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | devote such of her time, labour and attention
to the business of the Company as is necessary for the proper exercise of the Consultant's duties hereunder and, except as otherwise
provided herein, refrain from engaging in any business, venture, or other commercial or sales activities that in any material way
conflicts with or detracts from her ability to fulfill her duties in the manner contemplated in this paragraph; and
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | refrain from acting in any manner contrary
to the interests of the Company or contrary to the duties of the Consultant as contemplated herein.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------

| | 32. | Liability of Consultant
| | --- | -----------------------

32.1The Consultant shall indemnify and save the Company harmless from
and against all costs, expenses, losses, damages and obligations it may suffer or incur as the result of the breach of any covenant
or warranty made by the Consultant in this Agreement.

123







| | 33. | Termination
| | --- | -----------

33.1The term of this Agreement shall be for 3 1/2 months or such longer
period as may be provide for herein (the “Term”) and shall commence upon January 16, 2013 and unless terminated earlier
pursuant to the provisions hereof, or unless renewed in writing by the parties, shall expire on April 30, 2013..

33.2This Agreement may be terminated prior to the completion of the
Services (“Termination”) upon written notice given:

| | (a) | by the Consultant:
| | --- | ------------------

| | (i) | upon 30 days' prior written notice;
| | --- | -----------------------------------

| | (ii) | upon the occurrence of an Event of Default
by the Company as set out in clause 11.4(b);
| | ---- | ---------------------------------------------------------------------------------------

| | (b) | by the Company:
| | --- | ---------------

| | (i) | upon 30 days' prior written notice;
| | --- | -----------------------------------

| | (ii) | upon the occurrence of an Event of Default
by the Consultant as set out in clause 11.4 (a).
| | ---- | -------------------------------------------------------------------------------------------

33.3If either party fails to give any such notice, this Agreement shall
continue in full force and effect.

33.4An event of default of this Agreement (“Event of Default”)
shall be deemed to occur:

| | (a) | by the Consultant if she:
| | --- | -------------------------

| | (i) | is in breach of any covenant, obligation
or warranty hereunder and such breach continues for a period of seven (7) days after written notice thereof by the Company to the
Consultant;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (ii) | becomes unable to perform her duties hereunder
due to the Consultant’s death or any illness or physical or mental incapacity that continues for not less than thirty (30)
consecutive days;
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | by the Company if it:
| | --- | ---------------------

| | (i) | is in breach of any covenant, obligation
or warranty hereunder and such breach continues for a period of seven (7) days after written notice thereof by the Consultant to
the Company; or
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (ii) | becomes insolvent or is unable to discharge
its liabilities generally as they become due, makes an assignment for the benefit of its creditors, or is made subject to a petition
or other proceedings in bankruptcy.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

33.5Notwithstanding the termination of this Agreement or any other provision
herein, the covenants and obligations under section 8 hereof or contained in any agreement delivered hereunder with respect to
the use of confidential information, work product or non-competition with the Company shall remain in full force and effect for
a period of twelve (12) months thereafter.

| | 34. | Remuneration Payable on Termination
| | --- | -----------------------------------

34.1Notwithstanding any other provision herein, in the event of Termination,
the Company shall pay to the Consultant all amounts of Fees and Expenses accruing hereunder up to and including the effective date
of Termination.

34.2Without limiting the generality of the foregoing, if this Agreement
is Terminated, the Company shall not be obligated to pay any severance, retiring allowance, termination
bonus or any other amount other than as provided for in section 12.1.

124







| | 35. | Non-Assignability
| | --- | -----------------

35.1The Consultant shall not subcontract to any person, any right, duty
or obligation hereunder without the prior written consent of the Company. This Agreement may not be assigned by either party without
the prior written consent of the other party.

| | 36. | Co-operation with Other Parties
| | --- | -------------------------------

36.1The Consultant shall co-operate with all other parties engaged or
employed by the Company from time to time and shall coordinate her activities with the activities of such parties as and when requested
by the Company.

| | 37. | Force Majeure
| | --- | -------------

37.1Notwithstanding anything herein to the contrary, neither party hereto
shall be deemed to be in default with respect to the performance of the terms, covenants and conditions of this Agreement if the
same shall be due to any strike, lock-out, civil commotion, invasion, rebellion, hostilities, sabotage, governmental regulations
or controls, or acts of God.

| | 38. | Notice
| | --- | ------

38.1All notices, demands and payments required or permitted to be given
hereunder shall be in writing and may be delivered personally, or sent by telefax or other means of electronic communication providing
a printed copy ("Electronic Communication") or may be forwarded by first class prepaid registered mail to the addresses
set forth as set out on the first page of this Agreement. Any notice delivered or sent by Electronic Communication shall be deemed
to have been given and received at the time of delivery. Any notice mailed as aforesaid shall be deemed to have been given and
received on expiration of 72 hours after it is posted, addressed to the Company or the Consultant at their respective addresses
or telefax numbers set out above or such other address or addresses or telefax numbers as the parties may from time to time give
notice of in writing; provided that if there shall be between the time of mailing and the actual receipt of the notice a mail strike,
slow down or other labour dispute which may affect the delivery of such notice by the mails, then such notice shall be effective
only if actually delivered.

| | 39. | Entire Agreement
| | --- | ----------------

39.1The provisions herein contained constitute the entire agreement
between the parties and supersede all previous communications, representations and agreements, whether oral or written, between
the parties with respect to the subject matter hereof.

| | 40. | Further Assurances
| | --- | ------------------

40.1Each of the parties shall execute such other documents and instruments
and shall do such other acts as may be necessary to implement and carry out the intent of this Agreement.

| | 41. | Proper Law, Attornment and Venue
| | --- | --------------------------------

41.1This Agreement will be governed by and construed in accordance with
the laws of British Columbia. The Company and the Consultant hereby attorn to jurisdiction the Courts thereof and hereby select
Vancouver, British Columbia as the proper forum for any action commenced by any party with respect to this Agreement or the transactions
contemplated herein.

| | 42. | Time of Essence
| | --- | ---------------

42.1Time is of the essence of this Agreement.

125









| | 43. | Waiver of Breach
| | --- | ----------------



43.1The waiver by either the Company or the Consultant of a breach of
any provisions of this Agreement by the other party to this Agreement shall not operate or be construed as a waiver of any subsequent
breach by that party.

| | 44. | Regulatory Approval
| | --- | -------------------



44.1This Agreement is subject to the approval of all regulatory authorities
as may have jurisdiction (the "Regulatory Authorities").



IN WITNESS WHEREOF the parties have affixed
their common seal hereto in the presence of their officers duly authorized for that purpose.





|The corporate seal ofSAMEX MINING CORP.                 | )                                                                                                                                                                     |    
|------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---
|was hereunto affixed in the presence of:                | )                                                                                                                                                                     |    
|"Sasan Sadeghpour"
        Authorized
        Signatory | )
                                                                                )
                                                                                ) | c/s
|"Larry D. McLean"
        Authorized Signatory          | )
                                                                                )                                                                                   |    





|SIGNED, SEALED AND DELIVERED by Brenda
        McLean
        ________________________________________ | )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                )
                                                                                ) | 
|------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|in
the presence of:________________________________________                                            | "Brenda McLean"
        Brenda McLean                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Name
of Witness________________________________________                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Address
of Witness________________________________________Occupation of Witness                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          









126







Exhibit
4.5

CONSULTING
& CONFIDENTIALITY AGREEMENT



THIS AGREEMENT is made and entered into
this 16 day of January 2013, between



TORO TAYLOR Y COMPAÑIA LIMITADA
(a Chilean registered company), and the various business organizations and entities associated or controlled by it

(Hereinafter collectively referred to as "ETT
")



AND



MINERA SAMEX CHILE S.A. (a Chilean registered
company)

(Hereinafter referred to as "SAMEX")



WHEREAS ETT is an economic geologist consulting
group engaged in the review and evaluation of exploration and mining projects in the Republic of Chile; and



WHEREAS SAMEX is engaged in exploration for
and acquisition and/or exploitation of various mineral concessions in the Republic of Chile including any concessions referred
to on Schedule "B" (the "Properties"); and



WHEREAS, ETT will be employed by SAMEX as geological
consultants for the review of SAMEX’s existing exploration data, conducting certain approved exploration activities and further,
to generate recommendations as to possible future mineral exploration programs (hereinafter referred to as “ETT’s Work”,
see Schedule “A”) relating to SAMEX’s Properties; and



WHEREAS, ETT may acquire knowledge of SAMEX
business records, business plans and projections, corporate and financial information, contracts, and scientific or similar information,
including, without limitation, unique exploration techniques and improvements thereon, together with maps, diagrams, engineering
and geological reports and studies, assays, notes, data regarding quality and extent of mineral reserves, mining plans and studies,
and all other information relating thereto pertaining to its business and activities concerning said Properties, and records of
and from discussions with partners, officers, employees, advisors or representatives of SAMEX and/or pursuant to ETT’s relationship
as a consultant to SAMEX (all the foregoing hereinafter referred to as "Confidential Information"); and



WHEREAS SAMEX has expended substantial and
valuable resources in connection with these activities and the formation and acquisition of various entities in reliance on the
unique nature of its Confidential Information; and



WHEREAS, ETT may, from time to time, receive
from SAMEX Confidential Information; and



WHEREAS SAMEX desires that ETT have access
to said Confidential Information;



NOW THEREFORE, in conjunction with and consideration
of ETT’s Work (see Schedule “A”), the parties do hereby covenant and agree as follows:



1. TERM OF AGREEMENT. ETT and SAMEX agree that
this Agreement shall take effect upon the 17th of January, 2013 and in relation to ETT’s Work shall continue for
a period of three (3) months from the date indicated in this paragraph.

127









2. PROTECTION OF CONFIDENTIAL INFORMATION.
ETT agrees that all Confidential Information shall be considered and kept as the private and privileged records of SAMEX and will
not be divulged to any other person, firm, corporation, or other entity except upon the direct written authorization of SAMEX.



3. INFORMATION IN THE PUBLIC DOMAIN. SAMEX
agrees that any information which is in the public domain shall not be considered Confidential Information, provided it is not
public information as a result of disclosure by ETT during the Term of this Agreement.



4. SCOPE OF AGREEMENT. ETT and SAMEX agree
that any Confidential Information about which ETT obtained knowledge prior to the effective date of this Agreement shall be treated
as Confidential Information subject to this Agreement.



5. CONFIDENTIAL INFORMATION-ADMISSIONS BY ETT.
ETT admits that such Confidential Information is a valuable, special and unique asset of SAMEX business and gives SAMEX advantages
over its actual and potential competitors, and ETT further admits and agrees that (a) SAMEX has implemented policies necessary
to preserve the confidentiality of such Confidential Information, (b) ETT has access to such information and has been instructed
about its value to SAMEX and (c) unauthorized disclosure or use of such Confidential Information would irreparably harm SAMEX.



6. DISCLOSURE UNDER LEGAL PROCESS. Should ETT
be ordered by any legally constituted agency or authority of any government to disclose any Confidential Information, ETT shall
provide sufficient notice of such disclosure to SAMEX to permit SAMEX to protect its interests. Any disclosure by ETT pursuant
to such an order shall not constitute a breach of this Agreement, provided ETT has given timely notice to SAMEX about such order
and such order is final and subject to no further rights of appeal or other challenge. SAMEX will reimburse legal and reasonable
costs incurred by ETT in case of appeal or other challenge by SAMEX.



7. PAYMENT. SAMEX shall pay ETT the consultant
and compensation fees stated in Schedule A on a monthly basis and ETT shall submit the correspondent invoice on the last day of
the month and SAMEX shall pay the invoice in full within 10 days from the date of receipt of the invoice. The invoice shall include
all the supporting documents related to the fees and the travel expenses incurred, which require the prior approval of SAMEX.



8. COVENANT AGAINST COMPETITION. ETT hereby
covenants and agrees that for the term of this Agreement, ETT shall not engage directly or indirectly, either personally or as
an employee, partner, associate, manager, agent, corporation or other device, in research, exploration, consulting, teaching, demonstrating,
concession acquisition, option to purchase, or take any other action relating to activities which are in competition with and are
identical or similar to those of SAMEX specifically within two (2) kilometres of the external boundaries of the Properties. SAMEX
reserves the right to enlarge the scope of this Agreement by future annexure and due amendments only with the written consent and
approval of ETT and SAMEX. For a period of 2 years, ETT or its participants and managers shall not acquire or file any mining concession
requests or mining concessions for exploration or exploitation within two (2) kilometres of the external boundaries of the Properties
without the prior written approval of SAMEX.



9. RETURN OF RECORDS. At the request of SAMEX
at any time during the term of this Confidentiality Agreement, ETT shall deliver all records, notes, data, maps, memoranda, reports,
samples, equipment and any other property of any nature which is in ETT’s possession or under ETT’s control and which
is SAMEX property or relates to SAMEX business.



128







10. INJUNCTIVE RELIEF AND APPLICABLE LAW. This
Agreement shall be governed, by the laws of the Chilean republic. In addition to any other remedies available at law, equity or
otherwise SAMEX shall be entitled to an injunction against ETT by any competent court to enjoin and restrain the unauthorized disclosure
or any other use of any Confidential Information or the violation of any provision of this Agreement, and ETT hereby consents and
submits to the jurisdiction of such court as SAMEX may determine.



11. ARBITRATION. Any dispute related
to this Agreement will be solved through mediation and in the event of not being solved, through mandatory arbitration. After having
exhausted mediation, any difficulty or controversy arising between the parties in connection with the application, interpretation,
term, validity or performance of this Agreement or for any other reason whatsoever, shall be subject to the arbitration in accordance
with the Arbitration Regulations of the Santiago Arbitration and Mediation Center currently in force. The arbitrator shall rule
in accordance with the Chilean law and shall determine the proceeding (mixed arbitrator) The arbitrator shall be designated by
mutual agreement of the parties and in the event that the parties do not reach an agreement within 15 days, the Arbitrator shall
be appointed by the Santiago Arbitration and Mediation Center among those Arbitrators included in the list of arbitrators of the
said Center.

No appeal may be filed against the final
resolution or award issued by the arbitrator.



The arbitrator shall be especially empowered
to resolve any matter related to its jurisdiction.



The
arbitration shall take place in the city of Santiago.



12. SEVERABILITY. If any provision of this
Agreement is held to be illegal, invalid, or unenforceable under present or future laws effective during the term of this Agreement,
the legality, validity, and enforceability of remaining provisions shall not be affected thereby.



13. TERMINATION. This Agreement terminates
on April 17, 2013. ETT will continue to be bound by the Confidential Information responsibilities of this agreement for a period
of two (2) years from the date of termination.



14. DOMICILIUM.





|SAMEX: | Av. Isidora Goyenechea 2939, Of. 704 | 
|------ | ------------------------------------ | 
|       | Las Condes, Santiago - Chile         | 
|       | Phone:	562 232 3004                  | 
|       | Fax:	    562
333 8633                | 
|       |                                      | 
|ETT:   | Doctora Cora Mayer N° 88             | 
|       | Las Condes, Santiago -
Chile         | 
|       | Phone:	562 769 9155                  | 
|       |                                      | 





| |  | 
| |  | 







Accepted and agreed to this 16th day of January 2013,
in Santiago, Republic of Chile.







|TORO TAYLOR Y COMPAÑIA LIMITADA | MINERA SAMEX CHILE S.A.
|------------------------------- | -----------------------
|                                |                        







Per Authorized Signatories:





129









|By: "Juan Carlos Toro Taylor" |        | By: "Francisco Vergara"
|----------------------------- | ------ | -----------------------
|Name:                         | Title: |                        
|                              |        |                        
|                              |        |                        
|WITNESS NAME:                 |        | WITNESS NAME:          
|                              |        |                        
|                              |        |                        
|                              |        |                        
|                              |        |                        
|Signature                     |        | Signature              
|                              |        |                        















130









SCHEDULE “A”

TO CONSULTING & CONFIDENTIALITY AGREEMENT
BETWEEN MINERA SAMEX CHILE S.A. (“SAMEX”) AND TORO TAYLOR Y COMPAÑIA LIMITADA (“ETT”)



|Commencement of Agreement         | January 17, 2013.                                                                                                                                                                                                                                                                                                                                                                                                                  
|--------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Term of Agreement                 | Three (3) months, terminating on April 17th, 2013.                                                                                                                                                                                                                                                                                                                                                                                 
|ETT Reports to                    | SAMEX Board of Directors                                                                                                                                                                                                                                                                                                                                                                                                           
|ETT Supervisory Contacts          | Sasan Sadeghpour, CEO Samex Mining Corp.                                                                                                                                                                                                                                                                                                                                                                                           
|ETT’s Work and services           | 1.Review existing Los Zorros, Chimberos and Inca exploration data.
        2.Drill Los Zorros and/or Chimberos and Inca targets.
        3.Log and send for assaying all drilled core (rush assay all mineralized sections).
        4.Conduct various approved exploration activities, which include sampling, mapping and various
        others.
        5.Prepare formal recommendations based in results.                     
|ETT Consultants and compensation  | 1.Consultant Expert Geologist – Juan Carlos Toro Taylor: US$14,000 per month,
        2.Senior Consultant Geologist 1 - US$9,000 per month.
        3.Senior Consultant Geologist 2 – US$9,000 per month.
        4.Drawing/Data Technician - $3,500 per month.
        5.Two assistant geologists/Samplers/Drivers - 2x$2,250 per month.                                                                                          
|SAMEX will provide                | 1.One Hilux truck for ETT use. (possibly two if needed from time to time).
        2.Office space and supplies at Los Zorros camp, with internet, printing and plotting facilities
        etc.
        3.Individual accommodations for up to five persons at the Los Zorros camp.
        4.All meals at Los Zorros or Copiapo.
        5.Additional support staff (2) at Los Zorros for sampling, core-box moving, logistics etc.
|Exploration activities and budget | To include at least 1,200 meters of drilling. Other activities to be discussed and approved by Board of Directors of Samex.                                                                                                                                                                                                                                                                                                        
|Travel expenses                   | Various flights and hotel nights in Copiapo, to be reimbursed prior presentation of invoices and expense report approved by Samex.                                                                                                                                                                                                                                                                                                 
|Administrative Fee                | ETT will charge an administrative fee of 10% on exploration activities and travel expenses. The administrative fee will not be charged on salaries/ compensation paid to ETT consultants.                                                                                                                                                                                                                                          





131







SCHEDULE “B”



PROPERTIES (FV NOTE: INCLUDE A MAP OF THE
RESTRICTED AREA IN CHIMBEROS AND INCA)



LZ property outline 2012





132









Exhibit 8.1





LIST OF SUBSIDIARIES





The following companies are subsidiaries
of SAMEX Mining Corp. as ofApril 26, 2013:





|NAME OF SUBSIDIARY                                           | JURISDICTION OF INCORPORATION | OWNERSHIP
|------------------------------------------------------------ | ----------------------------- | ---------
|                                                             |                               |          
|Minera Samex Chile S.A. (“Samex Chile”)                      | Chile                         | 99.9%    
|South American Mining & Exploration Corp.
        - inactive | British Columbia, Canada      | 100%     
|SAMEX International Ltd. - inactive                          | Bahamas                       | 100%     
|SAMEX S.A. - inactive                                        | Bolivia                       | 98%      
|Minas Bolivex S.A. (“BOLIVEX “)
        - inactive           | Bolivia                       | 98%      
|Empresa Minera Boliviana S.A. (“EMIBOL”)
        - inactive  | Bolivia                       | 98%      





For details see Item 4 - “Information On The Company”

133







Exhibit 12.1

CERTIFICATION



I, Sasan Sadeghpour, certify that:



1.	I have reviewed this annual report on
Form 20-F of Samex Mining Corp.;



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



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



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



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

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

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

| | (d) | Disclosed in this report any change in the Company's internal control over financial reporting
that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting; and
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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



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

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



|Date: April 30, 2013 |  | “Sasan Sadeghpour”                               
|-------------------- |  | -------------------------------------------------
|                     |  | Sasan Sadeghpour, Interim Chief Executive Officer



134







Exhibit 12.2

CERTIFICATION



I, Larry Dennis McLean, certify that:



1.	I have reviewed this annual report on
Form 20-F of Samex Mining Corp.;



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



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



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



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

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

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

| | (d) | Disclosed in this report any change in the Company's internal control over financial reporting
that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting; and
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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



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

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





|Date: April 30, 2013 |  | “Larry D. McLean”                               
|-------------------- |  | ------------------------------------------------
|                     |  | Larry D. McLean, Interim Chief Financial Officer





135







Exhibit 13.1







CERTIFICATION PURSUANT TO

18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002







In connection with the Annual Report of Samex
Mining Corp. (the “Company”) on Form 20-F for the fiscal year ended December 31, 2012 as filed with the Securities
and Exchange Commission on the date here of (the “Report”), I, Sasan Sadeghpour, Interim Chief Executive Officer of
the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:



(1)	The Report fully complies
with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)	The information contained
in this Report fairly presents, in all material respects, the financial condition and results of operations of the Company.









| |  | “Sasan Sadeghpour”             
| |  | -------------------------------
| |  | Sasan Sadeghpour               
| |  | Interim Chief Executive Officer
| |  | April 30, 2013                 















136







Exhibit 13.2











CERTIFICATION PURSUANT TO

18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002







In connection with the Annual Report of Samex
Mining Corp. (the “Company”) on Form 20-F for the fiscal year ended December 31, 2012 as filed with the Securities
and Exchange Commission on the date here of (the “Report”), I, Larry D. McLean, Interim Chief Financial Officer of
the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:



(1)	The Report fully complies
with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)	The information contained
in this Report fairly presents, in all material respects, the financial condition and results of operations of the Company.









| |  | “Larry D. McLean”              
| |  | -------------------------------
| |  | Larry D. McLean                
| |  | Interim Chief Financial Officer
| |  | April 30, 2013                 










137