UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
20549
FORM 40-F
[ ] REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934
OR
[X] ANNUAL REPORT PURSUANT TO SECTION 13(a) OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended
December 31, 2011
Commission File Number 001-34984
FIRST MAJESTIC SILVER
CORP.
(Exact name of registrant as specified in its
charter)
British Columbia, Canada
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1041
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Not Applicable
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(Province or other jurisdiction
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(Primary Standard Industrial
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(I.R.S. Employer
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of incorporation or
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Classification Code Number)
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Identification Number)
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organization)
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Suite 1805 925 West Georgia Street
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Vancouver, British Columbia V6C 3L2 Canada
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(604) 688-3033
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(Address and telephone number of Registrants principal
executive offices)
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National Registered Agents, Inc.
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1090 Vermont Avenue N.W.
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Suite 910
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Washington D.C. 20005
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(202) 371-8090
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Name, address (including zip code) and
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telephone number (including area code) of
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agent for service in the United States
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Securities to be registered pursuant to Section 12(b) of the
Act:
- 2 -
Title of each class
:
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Name of exchange on which registered
:
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Common Shares, no par value
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New York Stock Exchange
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Securities registered pursuant to Section 12(g) of the Act:
None
Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act:
None
For annual reports, indicate by check mark the information filed
with this Form.
[X] Annual information form [X] Audited annual financial
statements
Indicate the number of outstanding shares of each of the
issuers classes of capital or common stock as of the close of the period
covered by the annual report. 105,567,272
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 [ ] 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).
[ ] Yes [ ] No
- 3 -
EXPLANATORY NOTE
First Majestic Silver Corp. (the Company or the Registrant)
is a Canadian issuer eligible to file its annual report pursuant to Section 13
of the Securities Exchange Act of 1934, as amended (the Exchange Act) on Form
40-F pursuant to the multi-jurisdictional disclosure system of the Exchange Act.
The Company is a foreign private issuer as defined in Rule 3b-4 under 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.
FORWARD-LOOKING STATEMENTS
This annual report on Form 40-F and the exhibits attached
hereto contain forward-looking statements within the meaning of the United
States Private Securities Litigation Reform Act of 1995 and forward-looking
information within the meaning of applicable Canadian securities legislation.
Forward-looking statements, which are all statements other than statements of
historical fact, include, but are not limited to, statements with respect to the
future price of silver, the estimation of mineral reserves and mineral
resources, the realization of mineral reserve estimates, the timing and amount
of estimated future production, costs of production, reserve determination and
reserve conversion rates. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as plans, expects
or does not expect, is expected, budget, scheduled, estimates,
forecasts, intends, anticipates or does not anticipate, or believes,
or variations of such words and phrases or statements that certain actions,
events or results may, could, would, might or will be taken, occur
or be achieved. Forward-looking statements are subject to known and unknown
risks, uncertainties and other factors that may cause the actual results, level
of activity, performance or achievements of the Company to be materially
different from those expressed or implied by such forward-looking statements,
including but not limited to: fluctuations in the price of silver and gold; the
absence of control over mining operations from which the Company purchases
silver and risks related to these mining operations including risks related to
fluctuations in the price of the primary commodities mined at such operations,
actual results of mining and exploration activities, economic and political
risks of the jurisdictions in which the mining operations are located, changes
in project parameters as plans continue to be refined; and differences in the
interpretation or application of tax laws and regulations; as well as those
factors discussed in the section entitled Risk Factors in the Companys annual
information form (the AIF) for the financial year ended December 31, 2011.
Forward-looking statements are based on assumptions management believes to be
reasonable, including but not limited to: the continued operation of the mining
operations from which the Company purchases silver, no material adverse change
in the market price of commodities, that the mining operations will operate and
the mining projects will be completed in accordance with their public statements
and achieve their stated production outcomes, and such other assumptions and
factors as set out herein. Although the Company has attempted to identify
important factors that could cause actual results to differ materially from
those contained in forward-looking statements, there may be other factors that
cause results not to be as anticipated, estimated or intended. There can be no
assurance that forward-looking statements will prove to be accurate.
Accordingly, readers should not place undue reliance on forward-looking
statements. The forward-looking statements and forward-looking information
contained or incorporated by reference in this annual information form are
included for the purpose of providing investors with information to assist them
in understanding the Companys expected financial and operational performance
and may not be appropriate for other purposes. The Company does not undertake to
update any forward-looking statements that are included or incorporated by
reference herein, except in accordance with applicable securities laws.
- 4 -
NOTE TO UNITED STATES READERS DIFFERENCES
IN
UNITED STATES AND CANADIAN REPORTING PRACTICES
The Company is permitted, under a multi-jurisdictional
disclosure system adopted by the United States, to prepare this annual report in
accordance with Canadian disclosure requirements, which are different from those
of the United States. The Company prepares its financial statements (the
Audited Financial Statements) in accordance with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards
Board. See. First Time Adoption of IFRS described in Note 34 of the Audited
Financial Statements.
The AIF filed as Exhibit 99.1 to this annual report on Form
40-F has been prepared in accordance with the requirements of the securities
laws in effect in Canada, which differ from the requirements of United States
securities laws. The terms mineral reserve, proven mineral reserve and
probable mineral reserve are Canadian mining terms as defined in accordance
with Canadian National Instrument 43-101 Standards of Disclosure for Mineral
Projects (NI 43-101) and the Canadian Institute of Mining, Metallurgy and
Petroleum (the CIM) CIM Definition Standards on Mineral Resources and Mineral
Reserves, adopted by the CIM Council, as amended. These definitions differ from
the definitions in the United States Securities and Exchange Commission (SEC)
Industry Guide 7 (SEC Industry Guide 7) under the United States Securities Act
of 1933, as amended. Under SEC Industry Guide 7 standards, a final or
bankable feasibility study is required to report reserves, the three-year
historical average price is used in any reserve or cash flow analysis to
designate reserves and the primary environmental analysis or report must be
filed with the appropriate governmental authority.
In addition, the terms mineral resource, measured mineral
resource, indicated mineral resource and inferred mineral resource are
defined in and required to be disclosed by NI 43-101; however, these terms are
not defined terms under SEC Industry Guide 7 and are normally not permitted to
be used in reports and registration statements filed with the SEC. Investors are
cautioned not to assume that any part or all of mineral deposits in these
categories will ever be converted into reserves. Inferred mineral resources
have a great amount of uncertainty as to their existence and as to their
economic and legal feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher category. Under
Canadian rules, estimates of inferred mineral resources may not form the basis
of feasibility or pre-feasibility studies, except in rare cases. Investors are
cautioned not to assume that all or any part of an inferred mineral resource
exists or is economically or legally mineable. Disclosure of contained ounces
in a resource is permitted disclosure under Canadian regulations; however, the
SEC normally only permits issuers to report mineralization that does not
constitute reserves by SEC standards as in place tonnage and grade without
reference to unit measures.
Accordingly, information contained in this annual report and
the documents incorporated by reference herein containing descriptions of the
Companys mineral deposits may not be comparable to similar information made
public by U.S. companies subject to the reporting and disclosure requirements under the United States federal
securities laws and the rules and regulations thereunder.
- 5 -
CURRENCY
Unless otherwise indicated, all dollar amounts in this annual
report on Form 40-F are in United States dollars. The functional currency of the
parent entity, is the Canadian dollar, and for the Mexican operations the
functional currency is the United States dollar. The financial statement
presentation currency is the United States dollar. The accounts of our
self-sustaining foreign operations are translated at year end exchange rates,
and revenues and expenses are translated at the exchange rates in effect at the
date of the underlying transactions. Differences arising from these foreign
currency translations are recorded in other comprehensive income.
ANNUAL INFORMATION FORM
The AIF is filed as Exhibit 99.1 to, and incorporated by
reference in, this annual report on Form 40-F.
AUDITED ANNUAL FINANCIAL STATEMENTS
The Audited Financial Statements for the year ended December
31, 2011, including the reports of the Independent Registered Chartered
Accountants with respect thereto, are filed as Exhibit 99.2 to, and incorporated
by reference in, this annual report on Form 40-F.
MANAGEMENTS DISCUSSION AND ANALYSIS
The Companys managements discussion and analysis of results
of operations and financial condition for the year ended December 31, 2011 is
filed as Exhibit 99.3 to, and incorporated by reference in, this annual report
on Form 40-F.
CERTIFICATIONS
See Exhibits 99.4, 99.5, 99.6 and 99.7, which are included as
Exhibits to this annual report on Form 40-F.
DISCLOSURE CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
At the end of the period covered by this annual report, an
evaluation was carried out under the supervision of, and with the participation
of, the Companys management, including the Chief Executive Officer (CEO) and
Chief Financial Officer (CFO), of the effectiveness of the design and
operations of the Companys disclosure controls and procedures (as defined in
Rule 13a 15(e) and Rule 15d 15(e) under the Exchange Act). Based on that
evaluation, the CEO and the CFO have concluded that as of the end of the period
covered by this annual report, the Companys disclosure controls and procedures
were adequately designed and effective in ensuring that: (i) information
required to be disclosed by the Company in reports that it files or submits to
the SEC under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in applicable rules and forms
and (ii) material information required to be disclosed by the Company in reports
filed under the Exchange Act is accumulated and communicated to the Companys
management, including the CEO and CFO, as appropriate, to allow for accurate and
timely decisions regarding required disclosure.
- 6 -
Managements Annual Report on Internal Control Over
Financial Reporting.
The Companys management is responsible for establishing and
maintaining adequate internal control over financial reporting as defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The Companys internal
control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
and fair presentation of financial statements for external purposes in
accordance with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. 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 assessed the effectiveness of the Companys internal
control over financial reporting as of December 31, 2011, based on the criteria
set forth in Internal Control Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission. This evaluation included
review of the documentation of controls, evaluation of the design effectiveness
of controls, testing of the operating effectiveness of controls and a conclusion
on this evaluation. Based on this evaluation, management has concluded that the
Companys internal control over financial reporting was effective as of December
31, 2011.
The Companys independent registered chartered accountants,
Deloitte & Touche LLP, have audited the consolidated financial statements
included in this annual report and have issued a report dated March 1, 2012 on
the Companys internal control over financial reporting.
Attestation Report of the Registered Public Accounting
Firm.
The Companys Independent Registered Chartered Accountants have
issued an attestation report on the Companys internal control over financial
reporting as of December 31, 2011, included with the Audited Financial
Statements for the year ended December 31, 2011, filed as Exhibit 99.2 and
incorporated by reference in this annual report on Form 40-F.
Changes in Internal Control Over Financial
Reporting.
During the period covered by this annual report on Form 40-F,
no change occurred in the Companys internal control over financial reporting
that has materially affected, or is reasonably likely to materially affect, the
Companys internal control over financial reporting.
The Companys management, including the CEO and CFO, does not
expect that its disclosure controls and procedures or internal controls and
procedures will prevent all error and all fraud. A control system, no matter how
well conceived and operated, can provide only reasonable, not absolute,
assurance that the objectives of the control system are met. Further, the design
of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within the Company have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
control. The design of any system of controls also is based in part upon certain
assumptions about the likelihood of future events, and there can be no assurance
that any design will succeed in achieving its stated goals under all potential
future conditions; over time, control may become inadequate because of changes
in conditions, or the degree of compliance with the policies or procedures may
deteriorate. Because of the inherent limitations in a cost-effective control
system, misstatements due to error or fraud may occur and not be detected.
- 7 -
AUDIT COMMITTEE
Audit Committee
The Companys Board of Directors has a separately designated
standing Audit Committee established in accordance with section 3(a)(58)(A) of
the Exchange Act. The members of the Companys Audit Committee are identified on
page 65 of the AIF, filed as Exhibit 99.1 and incorporated by reference herein.
In the opinion of the Companys Board of Directors, all members of the Audit
Committee are independent (as determined under Rule 10A-3 of the Exchange Act
and the rules of the New York Stock Exchange) and are financially literate.
Audit Committee Financial Expert
Douglas Penrose is the financial expert, in that he has an
understanding of generally accepted accounting principles and financial
statements; is able to assess the general application of accounting principles
in connection with the accounting for estimates, accruals and reserves; has
experience preparing, auditing, analyzing or evaluating financial statements
that entail accounting issues of equal breadth and complexity to the Companys
financial statements (or actively supervising another person who did so); has an
understanding of internal controls and procedures for financial reporting and an
understanding of audit committee functions.
CODE OF ETHICS
The Company has adopted a written Code of Ethical Conduct. A
copy of this code is available on the Companys website at
http://www.firstmajestic.com or to any person without charge, by written request
addressed to: First Majestic Silver Corp., Attention: Corporate Secretary, Suite
1805 925 West Georgia Street, Vancouver, British Columbia V6C 3L2 Canada (604)
688-3033, or by email (info@firstmajestic.com).
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Deloitte & Touche LLP acted as the Companys Independent
Registered Chartered Accountants for the financial year ended December 31, 2011.
See page 66 of the AIF, which is attached hereto as Exhibit 99.1 for the total amount billed to the
Company by Deloitte & Touche LLP for services performed in the last two
financial years by category of service (for audit fees, audit-related fees, tax
fees and all other fees) in Canadian dollars.
- 8 -
AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES
See Appendix A of the AIF incorporated by reference to this
document as Exhibit 99.1.
OFF-BALANCE SHEET ARRANGEMENTS
The Company does not have any off-balance sheet financing
arrangements that have or are reasonably likely to have a current or future
effect on its financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that is material to investors, or relationships with unconsolidated
special purpose entities.
TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS
The information provided under the heading Managements
Discussion and Analysis Contractual Obligations and Contingencies contained in
Exhibit 99.3 as filed with this annual report on Form 40-F contains the
Companys disclosure of contractual obligations and is incorporated by reference
herein.
UNDERTAKINGS
The Company undertakes to make available, in person or by
telephone, representatives to respond to inquiries made by the SEC staff, and to
furnish promptly, when requested to do so by the SEC staff, information relating
to: the securities registered pursuant to Form 40-F; the securities in relation
to which the obligation to file an annual report on Form 40-F arises; or
transactions in said securities.
CONSENT TO SERVICE OF PROCESS
The Company filed an Appointment of Agent for Service of
Process and Undertaking on Form F-X with respect to the class of securities in
relation to which the obligation to file this annual report on Form 40-F
arises.
- 9 -
EXHIBIT INDEX
Exhibit
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Description
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99.1.
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Annual Information
Form of the Company for the year ended December 31, 2011
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99.2.
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The following audited
consolidated financial statements of the Company, are exhibits to and form
a part of this Report:
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Report of Independent
Registered Chartered Accountants;
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Consolidated Statements of Income for the years
ended December 31, 2011 and 2010;
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Consolidated Statements of
Comprehensive Income for the years ended December 31, 2011 and 2010;
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Consolidated Statements of Cash Flow for the
years ended December 31, 2011 and 2010;
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Consolidated Statements of
Financial Position as at December 31, 2011, December 31, 2010 and January
1, 2011;
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Consolidated Statements of Changes in Equity
for the years ended December 31, 2011 and 2010
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99.3.
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Managements Discussion and Analysis
for the year and fourth quarter ended December 31, 2011
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99.4.
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CEO Certification pursuant to Rule
13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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99.5.
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CFO Certification pursuant to Rule
13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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99.6.
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CEO Certification pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
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99.7.
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CFO Certification pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
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99.8.
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Consent of Leonel Lopez, Principal
Geologist of Pincock, Allen & Holt
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99.9.
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Consent of Richard Addison, Principal
Process Engineer of Pincock, Allen & Holt
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99.10.
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Consent of Ramon Davila, Ing., Chief
Operating Officer of First Majestic Silver Corp.
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99.11.
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Consent of Florentino Muñoz, Ing.,
Chief Operating Officer of First Majestic Silver Corp.
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99.12.
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Consent of Deloitte & Touche LLP,
Independent Registered Chartered Accountants
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- 10 -
SIGNATURES
Pursuant to the requirements of the Exchange Act, the
Registrant certifies that it meets all of the requirements for filing on Form
40-F and has duly caused this Registration Statement to be signed on its behalf
by the undersigned, thereto duly authorized.
Date: March 30, 2012
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FIRST MAJESTIC SILVER CORP.
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By:
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/s/
Raymond Polman
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Raymond Polman
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Chief Financial
Officer
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