I just replaced the exhaust valve on a 12.5 HP Briggs and I can't get it to start. The motor stopped running and I found out the exhaust valve broke off. I replaced the exhaust valve and set the rocker arm gap to .04.  I am getting gas, fire and have compression.

OHV or flat head engine?
 
In any event, open up the exhaust clearance to .007-.008"
Intake, .005" to .006" 
 
What exactly is the compression?
 
Any damage to the cylinder wall , how bad to the piston top?
Compression rings could be squashed with the piston getting hammered. 
 
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OHV, not a flat head (missed the "rocker") head.
 
 
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Thanks for the reply. Yes it's an OHV and I just checked the compression three times and got 70psi. The top of the piston has two gouges/grooves about 3/16" x 1/8" x 1/8" deep, and no holes in the piston head. The cylinder walls show not scaring. 

70 PSI is quite low (and likely your issue).
 
Try putting some engine oil (couple teaspoons)  down the spark plug hole.
That will help increase pressure by helping the rings seal...
 
If still no good, a leak down test will help you find where the leakage is coming from.
 
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Ok did a leak test and no leaks outside on head or sump. I removed the head and reset the rocker arms to what you mentioned earlier and put in a new spark plug. I got it to finally start, but has heavy white smoke and hardly any power.  

What were the final #'s of the leak down test? 
Did you put 90 or 100 PSI in?     All machines will leak down. 
 
With the low compression, you may have a valve seat not fully seated.
This can be checked by turning the head upside down, spark plug in and 
putting fluid WD 40, this oil, etc.  Check for the fluid leaking out.
 
The impacts to the piston could have pounded the piston aluminum , near the rings, preventing them from sealing (very possible).  
Unfortunately you have to pull the engine and the rod / piston to check / repair.
 
 
 
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