Exhibit 4.2

                        WITS BASIN PRECIOUS MINERALS INC.

                         2003 DIRECTOR STOCK OPTION PLAN


         1. PURPOSE.  The purpose of the Wits Basin Precious  Minerals Inc. 2003
Director  Stock  Option Plan (the  "Plan") is to advance the  interests  of Wits
Basin Precious Minerals Inc. (the "Company") and its shareholders by encouraging
share  ownership  by  members  of the Board of  Directors  of the  Company  (the
"Board")  who are not  employees of the Company or any of its  subsidiaries,  in
order to promote long-term shareholder value through continuing ownership of the
Company's common stock.

         2.  ADMINISTRATION.  The plan shall be administered  by the Board:  The
Board  shall  have all the  powers  vested in it by the terms of the Plan,  such
powers to  include  authority  (within  the  limitations  described  herein)  to
prescribe  the form of the agreement  embodying  awards of  non-qualified  stock
options  made  under the Plan  ("Options").  The  Board  shall,  subject  to the
provisions of the Plan, grant Options under the Plan and shall have the power to
construe the Plan, to determine all questions  arising  thereunder  and to adopt
and amend such rules and regulations for the  administration  of the Plan, as it
may deem  desirable.  Any  decisions of the Board in the  administration  of the
Plan, as described herein, shall be final and conclusive. The Board may act only
by a majority  of its members in office,  except  that the  members  thereof may
authorize any one or more of their number or any other officer of the Company to
execute and  deliver  documents  on behalf of the Board.  No member of the Board
shall be liable for  anything  done or omitted to be done by him or by any other
member of the Board in  connection  with the Plan,  except  for his own  willful
misconduct or as expressly provided by statute.

         3.  PARTICIPATION.  Each  member of the Board who is not an employee of
the Company or any of its  subsidiaries  (a  "Non-Employee  Director")  shall be
eligible to receive an Option in accordance with Paragraph 5 below.

         4. AWARDS UNDER THE PLAN.

         (a) Awards under the Plan shall include only Options,  which are rights
to purchase  common stock of the Company,  $.01 par value per share (the "Common
Stock").  Such  Options are subject to the terms,  conditions  and  restrictions
specified in Paragraph 5 below.

         (b) There may be issued  under the Plan  pursuant  to the  exercise  of
Options an aggregate of not more than 2,000,000 shares of Common Stock,  subject
to  adjustment  as provided in  Paragraph  6 below.  If any Option is  canceled,
terminates  or expires  unexercised,  in whole or in part,  any shares of Common
Stock that would otherwise have been issuable pursuant thereto will be available
for issuance under new Options.

         (c) A  Non-Employee  Director  to whom an  Option is  granted  (and any
person succeeding to such a Non-Employee Director's rights pursuant to the Plan)
shall have no rights as a shareholder  with respect to any Common Stock issuable
pursuant  to any  such  Option  until  the  date  of  the  issuance  of a  stock
certificate to him for such shares.  Except as provided in Paragraph 6 below, no
adjustment  shall be made for dividends,  distributions or other rights (whether
ordinary or  extraordinary,  and whether in cash,  securities or other property)
for which the record date is prior to the date such stock certificate is issued.


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         5.  NON-QUALIFIED  STOCK  OPTIONS.  Each Option  granted under the Plan
shall be evidenced  by an  agreement  in such form as the Board shall  prescribe
from  time to time in  accordance  with  the  Plan  and  shall  comply  with the
following terms and conditions:

         (a) The Option  exercise  price  shall be the "Fair  Market  Value" (as
herein  defined)  of the Common  Stock  subject  to such  Option on the date the
Option is  granted.  Fair  Market  Value shall be,  unless  otherwise  expressly
provided in this Plan,  be the amount  which the  Committee  determines  in good
faith  to be 100% of the  fair  market  value  of such a share as of the date in
question;  provided, however, that notwithstanding the foregoing, if such shares
are listed on a U.S.  securities  exchange or are quoted on the Nasdaq  National
Market System or Nasdaq SmallCap Stock Market ("Nasdaq"), then Fair Market Value
shall be  determined  by  reference  to the last sale price of a share of Common
Stock on such U.S. securities exchange or Nasdaq on the applicable date. If such
U.S. securities exchange or Nasdaq is closed for trading on such date, or if the
Common Stock does not trade on such date, then the last sale price used shall be
the one on the date  the  Common  Stock  last  traded  on such  U.S.  securities
exchange or Nasdaq, but in no event will such Option exercise price be less than
the par value of the Common Stock.

         (b) The Board  shall  determine  the  number of shares of Common  Stock
subject to each Option granted to Non-Employee Directors and, subject to Section
5(d)  hereof,  the vesting  schedule of each such  Option.  Notwithstanding  the
foregoing,  once such Options become outstanding,  a Non-Employee  Director will
still be entitled to the  anti-dilution  adjustments  provided  for in Section 6
hereof.

         (c) The Option shall not be transferable by the optionee otherwise than
by will or the laws of descent and distribution, and shall be exercisable during
his lifetime only by him.

         (d) Options shall not be exercisable:

                  (i) except pursuant to the vesting schedule established by the
         Board  and  after  the  expiration  of ten  years  from  the date it is
         granted.  Notwithstanding  anything to the contrary  herein,  an Option
         shall  automatically  become immediately  exercisable in full: (i) upon
         the removal of the Non-Employee  Director from the Board without cause;
         or (ii) in the event of a "change in control" of the Company. A "change
         in control" shall be defined as any of the following events:

                  (A)      any person or group of persons becomes the beneficial
                           owner of 30% or more of any  equity  security  of the
                           Company   entitled  to  vote  for  the   election  of
                           directors; or

                  (B)      a majority of the  members of the Board of  Directors
                           of the  Company is  replaced  within a period of less
                           than  two  years  by  directors   not  nominated  and
                           approved by the Board; or

                  (C)      the  shareholders  of the Company approve the sale or
                           other  disposition of all or substantially all of the
                           Company's  assets  (including a plan of liquidation);
                           or


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                  (D)      the   shareholders   of  the   Company   approve  the
                           reorganization,   merger  or   consolidation  of  the
                           Company or a statutory exchange of outstanding voting
                           securities  of  the  Company,   unless,   immediately
                           following such reorganization,  merger, consolidation
                           or exchange,  all or substantially all of the persons
                           who  were the  beneficial  owners,  respectively,  of
                           voting  securities  and Common  Stock of the  Company
                           immediately  prior  to such  reorganization,  merger,
                           consolidation or exchange  beneficially own, directly
                           or indirectly,  more than 50% of,  respectively,  the
                           combined voting power of the then outstanding  voting
                           securities entitled to vote generally in the election
                           of  directors  and the  then  outstanding  shares  of
                           common stock,  as the case may be, of the corporation
                           resulting   from   such    reorganization,    merger,
                           consolidation or exchange in  substantially  the same
                           proportions as their ownership,  immediately prior to
                           such   reorganization,   merger,   consolidation   or
                           exchange,  of the voting  securities and Common Stock
                           of the Company, as the case may be.

                  (ii)  unless  payment in full is made for the shares of Common
         Stock being acquired  thereunder at the time of exercise,  such payment
         shall be made in United  States  dollars  by cash or check,  or in lieu
         thereof,  by tendering to the Company  Common Stock owned by the person
         exercising  the Option and having a Fair Market Value equal to the cash
         exercise price applicable to such Option, or by a combination of United
         States dollars and Common Stock as aforesaid; and

                  (iii) unless the person  exercising the Option has been at all
         times during the period  beginning with the date of grant of the Option
         and ending on the date of such exercise, a Non-Employee Director of the
         Company, except that

                  (A)      if such  person  shall  cease to be a  member  of the
                           Board,  other than because of death, while holding an
                           Option  that has not  expired  and has not been fully
                           exercised,  such person may, at any time within three
                           years  of the  date he  ceased  to be a  Non-Employee
                           Director  (but  in no  event  after  the  Option  has
                           expired under the provisions of subparagraph  5(d)(i)
                           above),  exercise  the  Option  with  respect  to any
                           Common  Stock as to which he could have  exercised on
                           the  date  he  ceased  to  be  such  a   Non-Employee
                           Director; or

                  (B)      if any  person  to whom an  Option  has been  granted
                           shall die  holding an Option that has not expired and
                           has  not  been  fully   exercised,   his   executors,
                           administrators,  heirs or  distributees,  as the case
                           may be,  may,  at any time  within one year after the
                           date of such death (but in no event  after the Option
                           has  expired  under the  provisions  of  subparagraph
                           5(d)(i)  above),  exercise the Option with respect to
                           any shares subject to the Option.

         6.  DILUTION AND OTHER  ADJUSTMENTS.  In the event of any change in the
outstanding  Common  Stock of the  Company by reason of any stock  split,  stock
dividend,   split-up,    split-off,    spin-off,    recapitalization,    merger,
consolidation,  rights  offering,  reorganization,  combination  or  exchange of
shares,  a  sale  by the  Company  of  substantially  all  of  its  assets,  any
distribution  to  shareholders  other  than a  normal  cash  dividend,  or other
extraordinary  or unusual event, the number or kind of shares that may be issued
under the Plan pursuant to  subparagraph  4(b) above,  and the number or kind of
shares subject to, and the Option price per share under, all outstanding Options

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shall be  automatically  adjusted  so that  the  proportionate  interest  of the
participant  shall be  maintained as before the  occurrence of such event;  such
adjustment  in  outstanding  Options  shall be made without  change in the total
Option exercise price applicable to the unexercised  portion of such Options and
with a corresponding adjustment in the Option exercise price per share, and such
adjustment shall be conclusive and binding for all purposes of the Plan.

         7. MISCELLANEOUS PROVISIONS.

         (a)  Except as  expressly  provided  for in the Plan,  no  Non-Employee
Director or other  person  shall have any claim or right to be granted an Option
under  the  Plan.  Neither  the Plan nor any  action  taken  hereunder  shall be
construed  as giving any  Non-Employee  Director any right to be retained in the
service of the Company.

         (b) A  participant's  rights  and  interest  under  the Plan may not be
assigned or  transferred,  hypothecated or encumbered in whole or in part either
directly  or by  operation  of law  or  otherwise  (except  in  the  event  of a
participant's  death,  by  will  or  the  laws  of  descent  and  distribution),
including,  but  not  by  way  of  limitation,   execution,  levy,  garnishment,
attachment,  pledge,  bankruptcy  or in any other  manner,  and no such right or
interest of any  participant  in the Plan shall be subject to any  obligation or
liability of such participant.

         (c) Common Stock shall not be issued  hereunder  unless counsel for the
Company  shall be  satisfied  that  such  issuance  will be in  compliance  with
applicable federal, state, local and foreign securities, securities exchange and
other applicable laws and requirements.

         (d) It shall be a condition to the  obligation  of the Company to issue
Common  Stock  upon  exercise  of  an  Option,  that  the  participant  (or  any
beneficiary or person entitled to act under subparagraph 5(d)(iii)(B) above) pay
to the Company,  upon its demand, such amount as may be requested by the Company
for the purpose of satisfying any liability to withhold federal, state, local or
foreign income or other taxes. If the amount  requested is not paid, the Company
may refuse to issue such Common Stock.

         (e) The expenses of the Plan shall be borne by the Company.

         (f) By  accepting  any  Option or other  benefit  under the Plan,  each
participant  and each person claiming under or through him shall be conclusively
deemed to have indicated his acceptance and ratification of, and consent to, any
action taken under the Plan by the Company or the Board.

         (g) The appropriate officers of the Company shall cause to be filed any
reports,  returns or other information regarding Options hereunder or any Common
Stock  issued  pursuant  hereto as may be required by Section 13 or 15(d) of the
Securities  Exchange Act of 1934, as amended,  or any other applicable  statute,
rule or regulation.

         8. AMENDMENT OR DISCONTINUANCE. The Plan may be amended at any time and
from time to time by the  Board as the Board  shall  deem  advisable;  provided,
however,  that no amendment shall become effective without shareholder  approval
if such shareholder  approval is required by law, rule or regulation,  and in no
event shall the Plan be amended  more than once every six months,  other than to
comport  with  changes in the Internal  Revenue  Code of 1986,  as amended,  the
Employee Retirement Income Security Act or the rules thereunder. No amendment of
the Plan shall materially and adversely affect any right of any participant with
respect to any Option  theretofore  granted without such  participant's  written
consent.


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         9.  TERMINATION.  This Plan  shall  terminate  upon the  earlier of the
following  dates or events to occur upon the  adoption  of a  resolution  of the
Board  terminating  the Plan or ten  years  from the date the Plan is  initially
approved and adopted by the  shareholders of the Company.  No termination of the
Plan shall  materially and adversely  affect any of the rights or obligations of
any person,  without his consent, under any Option theretofore granted under the
Plan.

         10.  EFFECTIVE DATE OF PLAN. The Plan will become effective on the date
that it is approved by the Board.