Northern Dynasty Minerals Ltd.: Exhibit 4.5 - Filed by newsfilecorp.com






UNLESS PERMITTED UNDER THE SECURITIES LEGISLATION, THE
HOLDER OF THESE SPECIAL WARRANT SECURITIES MUST NOT TRADE THEM BEFORE DECEMBER
29, 2015. 

THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES
ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT") OR THE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING SUCH
SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH SECURITIES MAY BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY; (B) OUTSIDE THE
UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S.
SECURITIES ACT; (C) IN ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION UNDER THE
U.S. SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER, IF AVAILABLE, AND IN
COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS; OR (D) IN A TRANSACTION
THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, AND, IN THE CASE OF PARAGRAPH (C) OR (D), THE
SELLER FURNISHES TO THE COMPANY AN OPINION OF COUNSEL OF RECOGNIZED STANDING IN
FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY TO SUCH EFFECT. 

NORTHERN DYNASTY MINERALS LTD. 

(INCORPORATED UNDER
THE LAWS OF BRITISH COLUMBIA) 

SPECIAL WARRANT CERTIFICATE (ISIN NO. CA66510M1133) 

	CERTIFICATE NO. 	 	♦ SPECIAL WARRANTS, each of which 
	SW-♦ 	 	will be exercised into one Underlying Share at  
	  	 	no additional cost 


THIS IS TO CERTIFY THAT FOR VALUE RECEIVED 

♦ (hereinafter referred to as the "Holder") is
the registered holder of the number of Special Warrants specified above. 

Special Warrants are issued subject to the terms and conditions
appended hereto as Schedule "A". This Special Warrant is subject to
deemed (automatic) conversion into Underlying Shares of Northern Dynasty
Minerals Ltd. in certain events and if not earlier exercised on a voluntary or
deemed basis will be automatically converted in any event on the second
anniversary of the issuance date below. 

IN WITNESS WHEREOF, the Company has caused this Special
Warrant Certificate to be executed and issued by a duly authorized officer of
the Company effective this 28th day of August, 2015.

NORTHERN DYNASTY MINERALS LTD.


Per:
________________________________________

        Authorized Signatory 

(The Terms and Conditions attached hereto form an integral
part of this Special Warrant Certificate) 




SCHEDULE "A" 

TERMS AND CONDITIONS OF SPECIAL WARRANTS OF NORTHERN DYNASTY
MINERALS LTD. 

	
      1. 
	
      CONVERSION INTO UNDERLYING SHARES. 
	2 
	
       
	
       
	 
	
      2. 
	
      MANNER OF EFFECTING VOLUNTARY CONVERSION 
	4 
	
       
	
       
	 
	
      3. 
	
      CERTAIN U.S. SECURITIES LAW MATTERS 
	4 
	
       
	
       
	 
	
      4. 
	
      COVENANTS REGARDING RESALE FILINGS, RESERVATION OF
      SUFFICIENT UNDERLYING SHARES, ETC. 
	5 
	
       
	
       
	 
	
      5. 
	
      CAPITAL ADJUSTMENTS 
	6 
	
       
	
       
	 
	
      6. 
	
      PARTIAL CONVERSION, EXCHANGE AND REPLACEMENT OF
      CERTIFICATES 
	10 
	
       
	
       
	 
	
      7. 
	
      MEETINGS OF SPECIAL WARRANT HOLDERS 
	11 
	
       
	
       
	 
	
      8. 
	
      NOTICE 
	12 
	
       
	
       
	 
	
      9. 
	
      MISCELLANEOUS 
	13 
	
       
	
       
	 
	
      10. 
	
      CERTAIN DEFINITIONS: 
	13 


Appendix “A” - Voluntary Exercise Form 
Appendix “B” - Form
of Declaration for Removal of Legend 
Appendix “C” - Special Warrant Exercise
Blocker Initiation and Termination Form 

	1. 	
      Conversion into Underlying
  Shares.




	
       
	
      (a) 
	
      Right and Obligation to Acquire Underlying
      Shares. Subject to the restrictions herein, each Special Warrant,
      will be convertible into Underlying Shares on a one-for-one basis as
      follows: (i) upon the voluntary exercise of the Special Warrant by its
      holder at any time to the extent that such exercise is permitted by the
      terms hereof, or (ii) upon the deemed exercise of the Special Warrants as
      generally described below in this section 1. In no event will the Special
      Warrants be exchangeable or redeemable for cash. In each case the Holder
      will receive one Underlying Share, for no further payment or additional
      consideration on voluntary or deemed exercise of a Special
  Warrant.

	
       
	
       
	
       

	
       
	
      (b) 
	
      Deemed Exercise for Electing Non-Affiliate Non-U.S.
      Holders. Any unexercised Special Warrants held by any Non-U.S.
      Person holder who beneficially owns less than 9.99% of the outstanding
      Shares (each, a “Non-Affiliate Non-U.S. Holder”) and who has
      elected not to be governed by Section1(h) will be deemed to be exercised
      at 4:00 p.m. (Vancouver time) on the earlier of (i) the date that is the
      sixth business day after the date on which the Company obtains a receipt
      for the Final Prospectus from the (Canadian) Securities Commissions
      qualifying the distribution of the Underlying Shares; and (ii) the date
      that is four months plus one day after Closing (the “CDN Qualification
      Date”).

	
       
	
       
	
       

	
       
	
      (c) 
	
      Deemed Exercise for Non-Electing Affiliate Non-U.S.
      Holders. Any unexercised Special Warrants held by any Non-U.S.
      Person holder who beneficially owns more than 9.99% of the outstanding
      Shares (each, a “Affiliate Non-U.S. Holder”) and (i) who has
      elected not to be governed by Section 1(i), and (ii) who has not elected
      to be governed by Section 1(h), will be deemed to be exercised at 4:00
      p.m. (Vancouver time) on the CDN Qualification Date.

	
       
	
       
	
       

	
       
	
      (d) 
	
      Deemed Exercise for Electing Non-Affiliate U.S.
      Holders. Any unexercised Special Warrants held by any U.S. Person
      holder who beneficially owns less than 9.99% of outstanding Shares (each,
      a “Non-Affiliate U.S. Holder”) and who has elected not to be
      governed by Section1(i), will be deemed to be exercised at 4:00 p.m.
      (Vancouver time) on the CDN Qualification Date.

	
       
	
       
	
       

	
       
	
      (e) 
	
      Deemed Exercise for Other Holders. Any
      unexercised Special Warrants held by (i) any U.S. Person holder who
      beneficially owns more than 9.99% of the outstanding Shares (each, a
      “Affiliate U.S. Holder”), (ii) any Affiliate Non-U.S. Holder who
      has either elected to be governed by Section 1(h) or not elected not to be
      governed by Section 1(i), and (iii) any Non- Affiliate Non-U.S. Holder or
      Non-Affiliate U.S. Holder, other than any Non-Affiliate Non-U.S. Holder or
      Non-Affiliate U.S. Holder who has elected not to be governed by Section
      1(i), will be deemed to be exercised at 4:00 p.m. (Vancouver time) on the
  Resale Filings Termination Date.







3 

	
       
	
      (f) 
	
      Meaning of Beneficially Own. For the
      purposes of determining whether a U.S. Person holder is an Affiliate U.S.
      Holder, a Non-Affiliate U.S. Holder, a Non-Affiliate Non-U.S. Holder or an
      Affiliate Non-U.S. Holder under this section 1, other than under Section
      1(j) with respect to the Company’s Shareholder Rights Plan, beneficial
      ownership shall be calculated in accordance with Section 13(d) of the U.S.
      Exchange Act, and the rules and regulations of the SEC promulgated
      thereunder, disregarding for this purpose the limitation on conversion
      described in Section 1(h) and similar limitation on conversion or exercise
      contained in any other Common Stock Equivalent, in each case, held by such
      holder and its affiliates and such other person or persons with whom such
      Holder may be deemed to be a Group. For purposes of Section 1(h), in
      determining the number of outstanding Shares, a holder may rely on the
      number of outstanding Shares as reflected in (A) the Company’s most recent
      report filed with the SEC, (B) a more recent public announcement by the
      Company or (C) a more recent written notice by the Company or its transfer
      agent setting forth the number of Shares outstanding. Upon the written or
      oral request of a holder, the Company shall within two Business Days
      confirm orally and in writing to the holder the number of Shares then
      outstanding.

	
       
	
       
	
       

	
       
	
      (g) 
	
      Voluntary Conversion. Subject to the
      restrictions in Sections 1(g), 1(h) and 1(i), the Special Warrants may be
      voluntarily exercised by their holder at any time prior to their deemed
      exercise by delivery of a Voluntary Exercise Form attached hereto as
      Appendix “A” to the Company. In such event the certificate representing
      the Underlying Shares will bear any restrictive legends required by
      applicable Securities Laws.

	
       
	
       
	
       

	
       
	
      (h) 
	
      Automatic 9.99% Blocker Restrictions for Affiliate
      and Electing Holders. No exercise of any Special Warrants by (i)
      any Affiliate U.S. Holder, or (ii) any Affiliate Non-U.S. Holder that has
      elected to be governed by this Section 1(g)), together with the respective
      holder’s affiliates, and any other Persons acting as a group together with
      the respective holder or any of the respective holder’s affiliates, will
      be permitted to the extent that, after giving effect to such exercise,
      such Holder would beneficially own in excess of the Beneficial Ownership
      Limitation (as defined below). To the extent that the limitation contained
      in this Section 1(g) applies, the determination of whether the Special
      Warrant is exercisable (in relation to other securities owned by the
      holder together with any affiliates) and of which portion of this Special
      Warrant is exercisable shall be in the sole discretion of the holder, and
      the submission of a notice of exercise shall be deemed to be the holder’s
      determination that the Special Warrant is exercisable in accordance with
      the terms hereof (in relation to other securities owned by the holder
      together with any affiliates) and of which portion of the Special Warrant
      is exercisable, in each case subject to the Beneficial Ownership
      Limitation, and the Company shall have no obligation to verify or confirm
      the accuracy of such determination. The “Beneficial Ownership
      Limitation” of this Section 1(g) shall be 9.99% of the number of
      Shares outstanding immediately after giving effect to the issuance of
      Shares issuable upon exercise of the Special Warrant. The holder, upon not
      less than 61 days’ prior notice to the Company, may increase or decrease
      the Beneficial Ownership Limitation provisions of this Section 1(g),
      subject to 1(i) and the provisions of this Section 1(g) shall continue to
      apply. Any such increase or decrease will not be effective until the 61st
      day after such notice is delivered to the Company. The provisions of this
      paragraph shall not be construed and implemented in a manner otherwise
      than in strict conformity with the terms of this Section 1(g) to correct
      this paragraph (or any portion hereof) which may be defective or
      inconsistent with the intended Beneficial Ownership Limitation herein
      contained or to make changes or supplements necessary or desirable to
      properly give effect to such limitation. In order to elect to terminate
      this 9.99% blocker the Holder should execute and deliver, fax or email to
      the Company the attached “Special Warrant Exercise Blocker Initiation and
      Termination Form” attached hereto as Appendix “C”.

	
       
	
       
	
       

	
       
	
      (i) 
	
      4.99% Blocker Restriction for Electing
      Non-Affiliate Holders. No exercise of any Special Warrants by any
      Non-Affiliate U.S. Holder, any Non-Affiliate Non-U.S. Holder or any
      Affiliate Non-U.S. Holder, other than a Non-Affiliate U.S. Holder,
      a Non-Affiliate Non-U.S. Holder or an Affiliate Non-U.S. Holder that has
      given notice of its election not to be governed by this Section 1(h),
      together with the respective holder’s affiliates, and any other Persons
      acting as a group together with the respective holder or any of the
      respective holder’s affiliates, will be permitted to the extent that,
      after giving effect to such exercise, such Holder would beneficially own
      in excess of the Beneficial Ownership Limitation (as defined below). The
      “Beneficial Ownership Limitation” of this Section 1(h) shall be
      4.99% of the number of Shares outstanding immediately after giving effect
      to the issuance of Shares issuable upon exercise of the Special Warrant.
      The balance of the provisions set forth above in Section 1(g) shall apply,
      with appropriate changes, to this Section 1(h). In order to elect to have
      the 4.99% blocker not apply, the Holder should execute and deliver, fax or
      email to the Company the attached “Special Warrant Exercise Blocker
      Initiation and Termination Form” attached hereto as Appendix
“C”.







4 

	
       
	
      (j) 
	
      Exercise Restriction Applicable to All Holders At
      All Times. Notwithstanding the foregoing provisions regarding
      conversion of Special Warrants, unless the Company’s Shareholders Rights
      Plan has been terminated, no Holder’s Special Warrants may at any time,
      voluntarily or automatically, be exercised in circumstances where the
      Shares issued on exercise thereof would, when aggregated with the other
      Shares beneficially owned by such Holder or any applicable Group of which
      the Holder is a member, exceed 19.99% of the number of Shares outstanding
      immediately after giving effect to the issuance of Shares upon exercise of
      such Special Warrants, as such beneficial ownership is calculated in
      accordance with Section 13(d) of the Exchange Act, provided that if the
      calculation of beneficial ownership were made under the Company’s
      Shareholder Rights Plan (the “SRP”), as it exists as of the date
      hereof, would result in a higher percentage of beneficial ownership, then
      such calculation for the purposes of ascertaining compliance with the SRP
      only shall be made in accordance with the SRP.




	2. 	
      Manner of Effecting Voluntary
    Conversion



2.1     Subject to Section 1(g), 1(h) and
1(i) above, and prior to the their deemed (automatic) conversion as noted above,
the Holder may voluntarily convert the Special Warrants evidenced by this
Special Warrant Certificate by: 

	
       
	
      (a) 
	
      duly completing and executing the Voluntary Exercise Form
      attached hereto as Appendix “A”; and

	
       
	
       
	
       

	
       
	
      (b) 
	
      surrendering this Special Warrant Certificate at the
      offices of the Company at 15th Floor, 1040 West Georgia Street, Vancouver,
      BC, V6E 4H1, Attention: Trevor Thomas.




	3. 	
      Certain U.S. Securities Law
  Matters



3.1     Any Special Warrants and the
Underlying Shares acquired by a Holder in the United States will be considered
“restricted securities” within the meaning of Rule 144(a)(3) under the U.S.
Securities Act and may not be offered, sold, pledged, or otherwise transferred,
directly or indirectly, unless: (A) the transfer is to the Company; (B) the
transfer is made outside the United States in accordance with Regulation S and
in compliance with applicable Canadian local laws or regulations; (C) the
transfer is made in compliance with an exemption from registration under the
U.S. Securities Act provided by Rule 144 there under, if available, and in
accordance with applicable state securities laws; (D) in another transaction
that does not require registration under the U.S. Securities Act or any
applicable state securities laws; or (E) pursuant to an effective registration
statement under the U.S. Securities Act, and in each case in accordance with any
applicable state securities laws in the United States, provided that, in the
case of transfers pursuant to (C) or (D) above, the Holder has, prior to such
transfer, furnished to the Company an opinion of counsel or other evidence of
exemption, in either case reasonably satisfactory to the Company. 

3.2     Upon issuance and until such time
as it is no longer required under applicable requirements of the U.S. Securities
Act or applicable state securities laws, all certificates representing the
Special Warrants issued hereunder and any Underlying Shares issued upon
conversion of the Special Warrants, as well as all certificates issued in
exchange for or in substitution of the foregoing, until such time as is no
longer required under the applicable requirements of the U.S. Securities Act or
applicable state securities laws, will bear, on the face of such certificate,
the following legends: 




5 

“THE SECURITIES REPRESENTED HEREBY [IF A SPECIAL WARRANT
INCLUDE: "AND THE SECURITIES ISSUABLE UPON EXERCISE THEREOF"] HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S.
SECURITIES ACT”) OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE
HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE
COMPANY THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY
(A) TO THE COMPANY; (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF
REGULATION S UNDER THE U.S. SECURITIES ACT; (C) IN ACCORDANCE WITH THE EXEMPTION
FROM REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER,
IF AVAILABLE, AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS; OR
(D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S.
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS, AND, IN THE CASE OF
PARAGRAPH (C) OR (D), THE SELLER FURNISHES TO THE COMPANY AN OPINION OF COUNSEL
OF RECOGNIZED STANDING IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY TO SUCH
EFFECT.” 

"[FOR CERTIFICATES EVIDENCING UNDERLYING SHARES ONLY:]
THE PRESENCE OF THIS LEGEND MAY IMPAIR THE ABILITY OF THE HOLDER HEREOF TO
EFFECT "GOOD DELIVERY" OF THE SECURITIES REPRESENTED HEREBY ON A CANADIAN STOCK
EXCHANGE. A CERTIFICATE WITHOUT A LEGEND MAY BE OBTAINED FROM THE REGISTRAR AND
TRANSFER AGENT OF THE COMPANY IN CONNECTION WITH A SALE OF THE SECURITIES
REPRESENTED HEREBY AT A TIME WHEN THE COMPANY IS A "FOREIGN ISSUER" AS DEFINED
IN REGULATION S UNDER THE U.S. SECURITIES ACT, UPON DELIVERY OF THIS
CERTIFICATE, AN EXECUTED DECLARATION AND, IF REQUESTED BY THE COMPANY OR THE
TRANSFER AGENT, AN OPINION OF COUNSEL OF RECOGNIZED STANDING, EACH IN FORM
SATISFACTORY TO THE TRANSFER AGENT OF THE COMPANY AND THE COMPANY, TO THE EFFECT
THAT SUCH SALE OF THE SECURITIES REPRESENTED HEREBY IS BEING MADE IN COMPLIANCE
WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT.”; 

provided, that if the Special Warrants or Underlying Shares are
being sold outside the United States in compliance with the requirements of Rule
904 of Regulation S at a time when the Company is a "foreign issuer" as defined
in Regulation S at the time of sale, the legends set forth above may be removed
by providing an executed declaration to the registrar and transfer agent of the
Company, in substantially the form set forth as Appendix “B” attached hereto (or
in such other forms as the Company may prescribe from time to time) and, if
requested by the Company or the transfer agent, an opinion of counsel of
recognized standing in form and substance satisfactory to the Company and the
transfer agent to the effect that such sale is being made in compliance with
Rule 904 of Regulation S; and provided, further, that, if any Special Warrants
or Underlying Shares are being sold otherwise than in accordance with Regulation
S and other than to the Company, the legend may be removed by delivery to the
registrar and transfer agent and the Company of an opinion of counsel, of
recognized standing reasonably satisfactory to the Company, that such legend is
no longer required under applicable requirements of the U.S. Securities Act or
state securities laws. The legends set forth above will also be removed (i)
pursuant to section 3.1(E) above (effective registration statement) and (ii) at
such time or times that the Underlying Shares can be sold under Rule 144 without
public information requirements or volume limitations, in either case upon
written request of the Holder made to the Company.

	4. 	
      Covenants Regarding Resale Filings, Reservation of
      Sufficient Underlying Shares, etc.



4.1     The Company shall use its
reasonable best efforts to, within 90 of the Closing Date, i) obtain a receipt
for the Final Prospectus in the Province in which the Special Warrants have been
sold to the Holder (or, if the Holder is not a resident of Canada, then in the
Province of British Columbia) qualifying the distribution of the Underlying
Shares for resale in Canada and the Company shall cause the Final Prospectus to
remain effective and current until the expiry of the four month Canadian hold
period otherwise applicable to unexercised Special Warrants, and ii) file a U.S. Registration Statement with the SEC and cause the U.S.
Registration Statement to be declared effective by the SEC qualifying the resale
of the Underlying Shares in the United States and cause such U.S. Registration
Statement to remain continuously effective until such time that investors may
resell the Underlying Shares pursuant to Rule 144 promulgated under the US
Securities Act of 1933 without any public information requirement or volume
limitations as determined by counsel to the investor, but in any event not
exceeding two years from closing in accordance with the Registration Rights
Agreement.




6 

4.2     The Company agrees with the Holder
that so long as any Special Warrants shall remain outstanding it will reserve
and keep available a sufficient number of Underlying Shares for the purpose of
enabling it to satisfy its obligations to issue the Underlying Shares issuable
upon the conversion of the Special Warrants, as may be adjusted hereby, and will
cause the Underlying Shares from time to time acquired pursuant to the
conversion of the Special Warrants to be duly issued and delivered at no
additional cost in the name of the Holder in accordance with the terms hereof.
The Underlying Shares will be issued as fully paid and non-assessable shares of
the Company, free from all liens, charges and encumbrances. The Company will,
within three (3) business days of the date of conversion or deemed conversion of
the Special Warrants, make available for pick-up or, at the request of the
Holder, mail to the Holder thereof certificates for the Underlying Shares issued
on such conversion at the address specified in the Voluntary Exercise Form
attached hereto as Appendix “A”.

4.3     For so long as the Special Warrants
remain outstanding, the Company shall use reasonable best efforts to preserve
and maintain its corporate existence and to ensure that the Underlying Shares
outstanding or issuable from time to time upon the conversion of the Special
Warrants are listed and posted for trading on the TSX and NYSE MKT (or such
other exchange on which the Underlying Shares may be listed), provided that this
clause shall not be construed as limiting or restricting the Company from
completing a consolidation, amalgamation, arrangement, takeover bid or merger
that would result in the Underlying Shares ceasing to be listed and posted for
trading on the TSX or NYSE MKT (or such other exchange on which the Underlying
Shares may be listed), so long as the holders of Underlying Shares receive
securities of an entity which is listed on a stock exchange in Canada or the
United States, or cash, or the holders of the Underlying Shares have approved
the transaction in accordance with the requirements of applicable corporate and
securities laws and the policies of the TSX and the NYSE MKT (or such other
exchange on which the Underlying Shares may be listed). In addition, the Company
shall make all requisite filings under applicable securities legislation
necessary to remain a reporting issuer not in default. 

4.4     For so long as the Special Warrants
remain outstanding, subject to the express provisions hereof, the Company shall
carry on and conduct and shall cause to be carried on and conducted its business
in the same manner as heretofore carried on and conducted and in accordance with
industry standards and good business practice, provided, however, that the
Company or any subsidiary of the Company may cease to operate or may dispose of
any business, premises, property, assets or operation if in the opinion of the
directors or officers of the Company or any subsidiary of the Company, as the
case may be, it would be advisable and in the best interests of the Company or
any subsidiary of the Company, as the case may be, to do so, and subject to the
express provisions hereof, it shall do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence, provided,
however, that (subject to Section 5 hereof) nothing herein contained shall
prevent the amalgamation, consolidation, merger, sale, winding-up or liquidation
of the Company or any subsidiary of the Company or the abandonment of any rights
and franchises of the Company or any subsidiary of the Company if, in the
opinion of the directors or officers of the Company or any subsidiary of the
Company, as the case may be, it is advisable and in the best interest of the
Company or of such subsidiary of the Company to do so. 

4.5     The Company hereby reconfirms as of
the date hereof all of the representations, warranties and covenants given by
the Company in the Subscription Agreement in favour of the Subscriber (as
defined in the Subscription Agreement) as if such representations, warranties
and covenants were made in favour of the Holder as of the date hereof. 

	5. 	
      Capital Adjustments



5.1     Subject to approval of the TSX and
NYSE MKT (or such other exchange(s) on which the Underlying Shares may be
listed), if at any time after the date hereof and prior to the expiry of the
Special Warrants, and provided that any Special Warrants remain unexercised,
there shall be 

	
       
	
      (a) 
	
      a reclassification of the Shares, a change in the Shares
      into other shares or securities, or any other capital reorganization of
      the Company other than as described in Section 5.2,
or







7 

	
       
	
      (b) 
	
      the triggering of a shareholders` rights plan or a
      consolidation, amalgamation, arrangement or merger of the Company with or
      into any other body corporate, trust, partnership or other entity or a
      transfer, sale, conveyance of the property and assets of the Company as an
      entirety or substantially as an entirety to any other body corporate,
      trust, partnership or other entity,



(any of such events being called a “Capital
Reorganization”) any Holders who shall thereafter acquire Underlying Shares
pursuant to the Special Warrant shall be entitled to receive, at no additional
cost, and shall accept in lieu of the number of Underlying Shares to which such
Holder was theretofore entitled to acquire upon such exercise, the aggregate
number of shares, other securities or other property which such Holder should
have been entitled to receive as a result of such Capital Reorganization if, on
the effective date or record date thereof as the case may be, the Holder had
been the registered holder of the number of Underlying Shares to which such
Holder was theretofore entitled to acquire upon exercise of the Special Warrants
then held. The Company shall not carry into effect any action requiring an
adjustment pursuant to which this Section 5.1 unless all necessary steps have
been taken so that the Holder is thereafter entitled to receive such kind and
number of Underlying Shares, other securities or property. If determined
appropriate by the Company acting reasonably, appropriate adjustments shall be
made in the application of the provisions set forth herein with respect to the
rights and interests of the Holder relative to a Capital Reorganization, to the
end that the provisions set forth herein shall correspond as nearly as may be
reasonably possible to the effect of the Capital Reorganization in relation to
any shares, other securities or other property thereafter deliverable upon the
conversion of any Special Warrants. 

5.2     If and whenever at any time from
the date hereof and prior to the expiry of the Special Warrants, the Company:


	
       
	
      (a) 
	
      subdivides, redivides or changes its outstanding Shares
      into a greater number of shares;

	
       
	
       
	
       

	
       
	
      (b) 
	
      consolidates, reduces or combines its outstanding Shares
      into a smaller number of shares; or

	
       
	
       
	
       

	
       
	
      (c) 
	
      issues Shares or securities exchangeable for or
      convertible to Shares (“convertible securities”) to the holders of
      all or substantially all of the outstanding Shares by way of a stock
      dividend (other than the issue of Shares or convertible securities to such
      holders as Dividends paid in the Ordinary Course);



(any of the above being a “Common Share
Reorganization”), the number of Underlying Shares issuable upon the exercise
of each Special Warrant is adjusted immediately after the effective date of the
Common Share Reorganization or on the record date for the issue of Shares or
convertible securities by way of stock dividend, by multiplying the number of
Underlying Shares previously obtainable on the exercise of a Special Warrant by
the fraction of which: 

	
       
	
      (i) 
	
      the numerator is the total number of Shares outstanding
      immediately after the effective or record date of the Common Share
      Reorganization, or, in the case of the issuance of exchangeable or
      convertible securities, the total number of Shares outstanding immediately
      after the effective or record date of the Common Share Reorganization plus
      the total number of Shares issuable upon conversion or exchange of such
      convertible securities; and

	
       
	
       
	
       

	
       
	
      (ii) 
	
      the denominator is the total number of Shares outstanding
      immediately prior to the applicable effective or record date of such
      Common Share Reorganization;



and the Company shall make such adjustment successively
whenever any event referred to in this Section 5.2 occurs and any such issue of
Shares or convertible securities by way of a stock dividend is deemed to have
occurred on the record date for the stock dividend for the purpose of
calculating the number of outstanding Shares under this Section 5.2. To the
extent that any convertible securities are not converted into or exchanged for
Shares, prior to the expiration thereof, the number of Underlying Shares
obtainable under each Special Warrant shall be readjusted to the number of
Underlying Shares that is then obtainable based upon the number of Shares
actually issued on conversion or exchange of such convertible securities. 

5.3     If and whenever at any time from
the date hereof and prior to the expiry of the Special Warrants, the Company
shall fix a record date for the issue of rights, options or warrants to all or
substantially all of the holders of Shares under which such holders are entitled, during a period
expiring not more than 45 days after the record date for such issue (“Rights
Period”), to subscribe for or acquire Shares at a price per share to the
holder of less than 95% of the Current Market Price for the Shares on such
record date (any of such events being called a “Rights Offering”), then the
number of Underlying Shares obtainable upon the exercise of each Special Warrant
shall be adjusted effective immediately after the end of the Rights Period to a
number determined by multiplying the number of Shares obtainable upon the
exercise thereof immediately prior to the end of the Rights Period by a
fraction: 




8 

	
       
	
      (a) 
	
      the numerator of which shall be the number of Shares
      outstanding after giving effect to the Rights Offering and including the
      number of Shares actually issued or subscribed for during the Rights
      Period upon exercise of the rights, warrants or options under the Rights
      Offering; and

	
       
	
       
	
       

	
       
	
      (b) 
	
      the denominator of which shall be the aggregate of: (A)
      the number of Shares outstanding as of the record date for the Rights
      Offering, and (B) a number determined by dividing (1) the product of the
      number of Shares issued or subscribed during the Rights Period upon the
      exercise of the rights, warrants, or options under the Rights Offering and
      the price at which such Shares are offered by (2) the Current Market Price
      of the Shares as of the record date for the Rights
  Offering.



5.4     If and whenever at any time from
the date hereof and prior to the conversion of the Special Warrants, the Company
shall issue or distribute to all or to substantially all of the holders of the
Shares: 

	
       
	
      (a) 
	
      securities of the Company including rights, options or
      warrants to acquire shares of any class or securities exchangeable for or
      convertible into or exchangeable into any such shares or property or
      assets and including evidence of its indebtedness; or

	
       
	
       
	
       

	
       
	
      (b) 
	
      any property (including cash) or other
  assets,



and if such issuance or distribution does not constitute
Dividends paid in the Ordinary Course, a Common Share Reorganization or a Rights
Offering (any of such non-excluded events being herein called a “Special
Distribution”), the number of Underlying Shares obtainable upon the exercise
of each Special Warrant shall be adjusted effective immediately after the record
date at which the holders of affected Shares are determined for purposes of the
Special Distribution to a number determined by multiplying the number of
Underlying Shares obtainable upon the exercise thereof in effect on such record
date by a fraction: 

	
       
	
      (i) 
	
      the numerator of which shall be the number of Shares
      outstanding on such record date multiplied by the Current Market Price of
      the Shares on such record date; and

	
       
	
       
	
       

	
       
	
      (ii) 
	
      the denominator of which shall be: (A) the product of the
      number of Shares outstanding on such record date and the Current Market
      Price of the Shares on such record date, less (B) the excess, if any, of
      (1) the fair market value on such record date, as determined by action by
      the directors (whose determination shall be conclusive), to the holders of
      the Shares of such securities or property or other assets so issued or
      distributed in the Special Distribution over (2) the fair market value of
      the consideration received therefor by the Company from the holders of the
      Shares, as determined by action by the directors (whose determination
      shall be conclusive), subject to TSX
acceptance.




	5.5 	
      In case at any time:




	
       
	
      (a) 
	
      the Company shall pay any dividend payable in stock upon
      its Underlying Shares or make any distribution to the holders of its
      Underlying Shares;

	
       
	
       
	
       

	
       
	
      (b) 
	
      the Company shall offer for subscription pro rata to the
      holders of its Underlying Shares any additional shares or stock of any
      class or other rights;

	
       
	
       
	
       

	
       
	
      (c) 
	
      the Company shall make any repayment of capital on, or
      distribution of evidences of indebtedness on, any of its assets (excluding
      cash dividends) to the holders of Shares;







9 

	
       
	
      (d) 
	
      there shall be any subdivision, consolidation, capital
      reorganization, or reclassification of the capital stock of the Company,
      or merger, amalgamation or arrangement of the Issuer with, or sale of all
      or substantially all of its assets to, another Company; or

	
       
	
       
	
       

	
       
	
      (e) 
	
      there shall be a voluntary or involuntary dissolution,
      liquidation or winding-up of the Company,



the Company shall give to the Holder at least twenty days’
prior written notice of the date on which the books of the Company shall close
or a record shall be established for such dividend, distribution, repayment or
subscription rights, or for determining rights to vote with respect to such
subdivision, consolidation, capital reorganization, reclassification, merger,
amalgamation, arrangement, sale, dissolution, liquidation or winding-up, and in
the case of any such subdivision, consolidation, capital reorganization,
reclassification, merger, amalgamation, arrangement, sale, dissolution,
liquidation or winding-up, at least twenty days’ prior written notice of the
date when the same shall take place. Such notice in accordance with the
foregoing clause shall also specify, in the case of any such dividend,
distribution, repayment or subscription rights, the date on which the holders of
Underlying Shares shall be entitled thereto, and such notice in accordance with
the foregoing shall also specify, in the case of any such subdivision,
consolidation, capital reorganization, reclassification, merger, amalgamation,
arrangement, sale, dissolution, liquidation or winding-up, the date on which the
holders of Underlying Shares shall be entitled to exchange their Underlying
Shares for securities or other property deliverable upon such subdivision,
consolidation, capital reorganization, reclassification, merger, amalgamation,
arrangement, sale, dissolution, liquidation or winding-up as the case may be.
Each such written notice shall be given by first class mail, postage prepaid,
addressed to the Holder at its address as shown on the books of the Company. Any
written notice contemplated by this Section 5.5 shall only be delivered after
the public announcement of such dividend, distribution, repayment or
subscription rights, or for determining rights to vote with respect to such
subdivision, consolidation, capital reorganization, reclassification, merger,
amalgamation, arrangement, sale, dissolution, liquidation or winding-up. 

5.6     The Company covenants and agrees
that it will not during the period of any notice given under Section 5.5 close
its share transfer books or take any other corporate action which might deprive
the Holder of the opportunity to exercise its Special Warrants; provided that
nothing contained in this Section 5.6 will be deemed to affect the right of the
Company to do or take part in any of the things referred to in Section5.5. 

5.7     The Company shall from time to time
immediately after the occurrence of any event which requires an adjustment as
provided in Section 5.1, 5.2, 5.3 or 5.4, deliver a notice to the Holder
specifying the nature of the event requiring the adjustment, the amount of the
adjustment necessitated thereby, and setting forth in reasonable detail the
method of calculation and the facts upon which the calculation is based. In the
event of a dispute about such calculation, the certificate shall be supported by
a certificate of the auditor appointed in Section 5.8 verifying such
calculation. 

5.8     In case the Company, after the date
hereof, shall take any action affecting any securities of the Company, other
than as previously set out herein, which in the opinion of the directors would
materially affect the rights and interests of the Holder hereunder, the number
of Underlying Shares or other securities which shall be issuable on the exercise
of the Special Warrants shall be adjusted in such manner, if any, and at such
time as the directors, in their sole discretion, acting reasonably and in good
faith, may determine to be equitable in the circumstances, provided that no such
adjustment will be made unless all necessary regulatory approvals, if any, have
been obtained. In the event of any question arising with respect to any
adjustment provided for herein, such question shall be conclusively determined
by an independent firm of Chartered Professional Accountants appointed by the
Company at its sole discretion (who may not be the Company’s auditors) and any
such determination shall be binding upon the Company and the Holder. 

5.9     No adjustment shall be made in
respect of any event described herein, other than the events referred to in
Sections 5.2(a) or 5.2(b), if the Holder is entitled to participate in such
event on the same terms, mutatis mutandis, without amendment, as if the
Holder had exercised the Special Warrants prior to or on the effective date or
record date of such event, subject to the written consent of the TSX (or such
other exchange on which the Underlying Shares may be listed). The adjustments
provided for herein are cumulative and such adjustments shall be made
successively whenever an event referred to herein shall occur, subject to the
limitations provided for herein. No adjustment shall be made in the number or
kind of Underlying Shares or other securities which may be acquired on the
exercise of a Special Warrant unless it would result in a change of at least
one-one hundredth of a Common Share or other security. Any adjustment which may
by reason of this paragraph not be required to be made shall be carried forward
and then taken into consideration in any subsequent adjustment. 




10 

5.10    After any adjustment pursuant to this
Section 5, the term “Underlying Shares” where used in this Special Warrant
Certificate is interpreted to mean securities of any class or classes which, as
a result of such adjustment and all prior adjustments pursuant to this Section
5, the Holder is entitled to receive upon the exercise of his Special Warrant,
and the number of Underlying Shares obtainable in any exercise made pursuant to
a Special Warrant is interpreted to mean the number of Underlying Shares or
other property or securities a Holder is entitled to receive, as a result of
such adjustment and all prior adjustments pursuant this Section 5, upon the full
exercise of a Special Warrant. 

5.11    Notwithstanding any adjustments provided
for herein or otherwise, the Company shall not be required, upon the exercise of
any Special Warrants, to issue fractional Underlying Shares or other securities
in satisfaction of its obligations hereunder and any fractions shall be
eliminated. To the extent that the Holder would otherwise be entitled to acquire
a fraction of a Common Share or other security, such right may be exercised in
respect of such fraction only in combination with other rights which in the
aggregate entitle the Holder to acquire a whole number of Underlying Shares or
other securities. The Company will not pay any cash compensation to any Holder
for the cancellation of fractional shares.

5.12    As a condition precedent to the taking
of any action which requires an adjustment as provided for herein, including the
number of Underlying Shares obtainable upon the exercise or deemed exercise
thereof, the Company shall take any corporate action which may in its opinion be
necessary in order that the Company or any successor to the Company has unissued
and reserved Shares in its authorized capital and may validly and legally issue
as fully paid and non-assessable all the Underlying Shares and may validly and
legally deliver all other securities or property which the Holder is entitled to
receive on the full exercise of the Special Warrants in accordance with the
provisions hereof. 

	6. 	
      Partial Conversion, Exchange and Replacement of
      Certificates



6.1     In the event any of the Special
Warrant Certificates shall be mutilated, lost, destroyed or stolen, the Company,
subject to applicable law, shall, at the expense of the Holder, issue a new
Special Warrant Certificate of like denomination, date and tenor as the one
mutilated, lost, destroyed or stolen in exchange for and in place of and upon
cancellation of such mutilated Special Warrant Certificate, or in lieu of and in
substitution for such lost, destroyed or stolen Special Warrant Certificate, and
the substituted Special Warrant Certificate shall be in a form approved by the
Company and the Holder thereof shall be entitled to the benefits of the original
Special Warrant Certificate and shall rank equally in accordance with its terms
with all other Special Warrant Certificates issued at the same time as the
original Special Warrant Certificate. 

6.2     The registered Holder of this
Special Warrant Certificate may, at any time prior to the voluntary or deemed
exercise of the Special Warrants, upon surrender hereof to the Company, exchange
this Special Warrant Certificate for other Special Warrant Certificates
entitling the Holder to acquire, in the aggregate, the same number of Underlying
Shares as may be acquired under this Special Warrant Certificate. 

6.3     The holding of the Special Warrants
evidenced by this Special Warrant Certificate shall not constitute the Holder
hereof a shareholder of the Company or entitle the Holder to any right or
interest in respect thereof except as expressly provided in this Special Warrant
Certificate. 

6.4     Prior to the conversion or deemed
conversion, the Special Warrants represented by this Special Warrant Certificate
shall be deemed to be surrendered only upon personal delivery hereof or, if sent
by mail or other means of transmission, upon actual receipt thereof by the
Company.

6.5     Following the full conversion or
deemed conversion of this Special Warrant Certificate, this Special Warrant
Certificate will be cancelled and the rights of the Holder hereunder (other than
the right of the Holder to receive certificates representing the Underlying
Shares issued on such conversion which right will survive until the Holder has
received the certificates) will terminate. Immediately after the conversion or
deemed conversion, this Special Warrant Certificate will be cancelled and the
rights of the Holder hereunder (other than the right of the holder to receive
Underlying Shares issued on conversion or deemed conversion of the Special
Warrant Certificate, which rights will survive until the Holder has received the
Underlying Shares) will terminate. 

6.6     Upon the date of conversion or
deemed conversion of these Special Warrants, the person or persons in whose name
or names the Underlying Shares issuable upon exercise of the Special Warrants
are to be issued shall be deemed for all purposes to be the holder or holders of record
of such Underlying Shares and the Company covenants that it will cause a
certificate or certificates representing such Underlying Shares to be delivered
or mailed to the person or persons listed in a register of Special Warrant
holders kept by the Company or, as applicable, at the address or addresses
specified in the Exercise Form (if the same has been provided to the Company
prior to such mailing) within five (5) business days. 




11 

6.7     The registered Holder of these
Special Warrants may acquire any lesser number of Underlying Shares than the
number of Underlying Shares which may be acquired for the Special Warrants
represented by this Special Warrant Certificate. In such event, the holder,
without charge therefor, shall be entitled to receive a new Special Warrant
Certificate for the balance of the Underlying Shares which may be acquired. No
fractional Underlying Shares will be issued. To the extent that the Holder would
otherwise have been entitled to receive, on the conversion or partial conversion
of Special Warrants, a fraction of a Common Share, the Holder may convert that
right in respect of the fraction only in combination with another Special
Warrant(s) that in aggregate entitle the Holder to purchase a whole number of
Underlying Shares. If not so converted, the Company shall not pay any amounts to
the Holder in satisfaction of the right to otherwise have received a fraction of
a Common Share. 

	7. 	
      Meetings of Special Warrant
  Holders



7.1     The registered Holder of this
Special Warrant Certificate may, at any time prior to the conversion or deemed
conversion of these Special Warrants, convene a meeting of the Special Warrant
holders, if the Holder executes a request for a meeting, signed in one or more
counterparts, by Special Warrant holders entitled to acquire in the aggregate
not less than 10% of the aggregate number of Underlying Shares which could be
acquired pursuant to all the Special Warrants then unconverted and outstanding.
At least ten (10) days prior notice of any meeting of Special Warrant holders
shall be given to the Special Warrant holders in the manner provided for below
and to the Company. Such notice shall state the time when and the place where
the meeting is to be held, shall state briefly the general nature of the
business to be transacted thereat and shall contain such information as is
reasonably necessary to enable the Special Warrant holders to make a reasoned
decision on the matter but it shall not be necessary for any such notice to set
out the terms of any resolution to be proposed. Every such meeting shall be held
in the City of Vancouver, British Columbia, or at such other place as may be
approved or determined by the Company. An individual (who need not be a Special
Warrant holder) designated in writing by the Company shall be Chairman of the
meeting and, if no individual is so designated or if the individual so
designated is not present within fifteen (15) minutes from the time fixed for
the holding of the meeting, the Special Warrant holders present in person or by
proxy shall choose an individual present to be Chairman. At any meeting of the
Special Warrant holders, a quorum shall consist of Special Warrant holders
present in person or by proxy and entitled to purchase at least 10% of the
aggregate number of Underlying Shares which could be acquired pursuant to all
the then outstanding Special Warrants, provided that at least two persons
entitled to vote thereat are personally present. No business shall be transacted
at any meeting unless a quorum is present at the commencement of business. The
Chairman of any meeting at which a quorum of the Special Warrant holders is
present may, with the consent of the meeting, adjourn any such meeting and no
notice of such adjournment need be given except such notice, if any, as the
meeting may prescribe. Representatives of the Company may attend any meeting of
the Special Warrant holders but shall have no vote as such unless in their
capacity as a Special Warrant holder or a proxy for a Special Warrant holder.
Questions other than those required to be determined by extraordinary resolution
shall be decided by a majority of the votes cast on the poll. In addition, the
Special Warrant holders at a meeting shall have the power, exercisable from time
to time by extraordinary resolution: 

	
       
	
      (a) 
	
      to amend, alter or repeal any extraordinary resolution
      previously passed or sanctioned by the Special Warrant holders;

	
       
	
       
	
       

	
       
	
      (b) 
	
      to direct or authorize a duly appointed representative of
      the Special Warrant holders to enforce any of the covenants on the part of
      the Company contained in this Special Warrant Certificate or to enforce
      any of the rights of the Special Warrant holders in any manner specified
      in such extraordinary resolution or to refrain from enforcing any such
      covenant or right;

	
       
	
       
	
       

	
       
	
      (c) 
	
      to waive any default on the part of the Company in
      complying with any provision of this Special Warrant Certificate, either
      unconditionally or on any condition specified in such extraordinary
      resolution;







12 

	 	(d) 	
      to restrain any Special Warrant holder from taking or
      instituting any suit, action or proceeding against the Company for the
      enforcement of any of the covenants on the part of the Company in this
      Special Warrant Certificate or to enforce any of the rights of the Special
      Warrant holders;

	 	 	 
	 	(e) 	
      to direct any Special Warrant holder who, as such, has
      brought a suit, action or proceeding to stay or discontinue or otherwise
      deal with the same on payment of the costs, charges and expenses
      reasonably and properly incurred by such Special Warrant holder in
      connection therewith;

	 	 	 
	 	(f) 	
      to assent to any change in or omission from the
      provisions contained in this Special Warrant Certificate or any ancillary
      or supplemental instrument which may be agreed to by the Company;
    and

	 	 	 
	 	(g) 	
      to assent to any compromise or arrangement with any
      creditor or creditors or any class or classes of creditors, whether
      secured or otherwise, and with holders of any shares or other securities
      of the Company.



7.2     An extraordinary resolution is
passed by the affirmative vote of Special Warrant holders entitled to acquire
not less than 66T% of the aggregate number of Underlying Shares which may be
acquired pursuant to all the then outstanding Special Warrants represented at
the meeting and voted on the poll on such resolution. Every resolution and every
extraordinary resolution passed in accordance with the provisions herein at a
meeting of the Special Warrant holders shall be binding on all the Special
Warrant holders, whether present at or absent from such meeting. This Special
Warrant Certificate shall be deemed to be amended to take into account the
effect of all such extraordinary resolutions. Such extraordinary resolutions
shall, where applicable, be binding on the Company which shall give effect
thereto accordingly. 

	8. 	
      Notice



8.1     Any notice to the Company under the
provisions of this Special Warrant shall be valid and effective if delivered to
or if given by registered letter, postage prepaid, addressed to the Company at:


	 	For the Company: 
	 	  
	 	15th Floor, 1040 West Georgia
      Street, 
	 	Vancouver, BC, V6E 4H1, 
	 	Attention: Trevor Thomas, 
	 	Tel: (604) 684-6365 
	 	Fax: (604) 684-8092 
	 	  
	 	With a courtesy copy (not required for valid
      delivery of notice to the Company) to: 
	 	  
	 	McMillan LLP 
	 	Royal Centre, 1055 West Georgia Street 
	 	Suite 1500, PO Box 11117 
	 	Vancouver, BC, V6E 4N7 
	 	Attention: Bernhard Zinkhofer 
	 	Tel: (604) 689-9111 
	 	Fax: (604) 685-7084 


and shall be deemed to have been effectively given on the date
of delivery or, if mailed, five (5) days after actual posting of the notice. The
Company may from time to time notify the holders of Special Warrants in writing
of a change of address which thereafter, until changed by like notice, shall be
the address of the Company for all purposes of this Special Warrant. If, by
reason of a strike, lockout or other work stoppage, actual or threatened,
involving postal employees, any notice to be given to the holder hereunder could
reasonably be considered unlikely to reach its destination, such notice shall be
valid and effective only if it is delivered to the named officer or party to
which it is addressed or, if it is delivered to such party at the appropriate
address provided above, by telecopier, PDF, email or other means of prepaid,
transmitted and recorded communication. 




13 

8.2     Any notice to holders of Special
Warrants under the provisions of this Special Warrant shall be valid and
effective if sent by telecopier or email through electronic means, or letter or
circular through the ordinary post addressed to such holders at their post
office addresses appearing on the register of holders of Special Warrants and
shall be deemed to have been effectively given on the date of delivery or, if
mailed, five (5) days following actual posting of notice. If, by reason of a
strike, lockout or work stoppage, actual or threatened, involving postal
employees, any notice to be given to the holder hereunder could reasonably be
considered unlikely to reach its destination, such notice shall be valid and
effective only if it is delivered personally to such holder or if delivered to
the address of such holder contained in the register of Special Warrants
maintained by the Company, by telecopier or other means of prepaid transmitted
and recorded communication. 

8.3     In the event that any day on or
before which any action is required to be taken hereunder is not a business day
in Vancouver, British Columbia, then such action shall be required to be taken
at or before the requisite time on the next succeeding day that is a business
day. 

	9. 	
      Miscellaneous



9.1     This Special Warrant Certificate
shall be construed in accordance with the laws of the Province of Ontario and
shall be treated in all respects as an Ontario contract. 

9.2     Time shall be of the essence
hereof. 

	10. 	
      Certain
Definitions:



10.1    In addition to other terms defined in
the body hereof, the following terms have the meanings defined below: 

		
      (a) 
	
      “beneficially own(s)” means to own within the
      meaning of Section 13(d) of the U.S. Exchange Act and the rules and
      regulations of the SEC promulgated thereunder;

	
       
	
       
	
       

		
      (b) 
	
      “CDN Qualification Date” means the date a receipt
      is issued by Canadian securities regulators for the Final Prospectus as
      described in Section 1(a);

	
       
	
       
	
       

		
      (c) 
	
      “Common Stock Equivalent” means any securities of
      the Company which would entitle the holder thereof to acquire at any time
      Shares, including, without limitation, any debt, preferred stock,
      warrants, options or other instruments convertible into or exercisable or
      exchangeable for Shares;

	
       
	
       
	
       

		
      (d) 
	
      “Company” means Northern Dynasty Minerals
    Ltd.

	
       
	
       
	
       

		
      (e) 
	
      “Current Market Price” of a Share at any date
      means the price per share equal to the volume weighted average price at
      which the Shares have traded during the five (5) consecutive trading days
      ending five days before such date, on the TSX, or, if the Shares are not
      listed thereon, on any stock exchange on which such shares are listed as
      may be selected for such purpose by the directors or, if such shares are
      not listed on any stock exchange, then on such over-the-counter market in
      Canada as may be selected for such purpose by the directors, provided
      further that if the Common Shares are not then listed on any Canadian
      stock exchange or traded in the over-the counter market, then the Current
      Market Price shall be determined by such firm of independent Chartered
      Professional Accountants as may be selected by the directors of the
      Company;

	
       
	
       
	
       

		
      (f) 
	
      “Dividends paid in the Ordinary Course” means such
      dividends payable in cash (or in securities, property or assets of
      equivalent value) declared payable on a Share in any fiscal year of the
      Company to the extent that such dividends in the aggregate do not exceed
      in amount or value the greater of:




	
       
	
      (i) 
	
      100% of the aggregate amount or value of the dividends
      declared payable by the Company on the Shares in the period of 12
      consecutive months ended immediately prior to the first day of such fiscal
      year; and







14 

	
       
	
      (ii) 
	
      50% of the consolidated net earnings of the Company,
      before extraordinary items and after dividends paid on any and all
      preferred shares of the Company (if any) for the period of 12 consecutive
      months ended immediately prior to the first day of such fiscal year (such
      consolidated net earnings to be as shown in the audited consolidated
      financial statements of the Company for such 12 month period or, if there
      are no audited financial statements in respect of such period, computed in
      accordance with generally accepted accounting principles consistent with
      those applied in the preparation of the most recent audited consolidated
      financial statements of the Company);



and for such purposes the amount of any dividends paid in other
than cash or shares of the Company shall be the fair market value of such
dividends as determined by the directors; 

	
       
	
      (g) 
	
      “Final Prospectus” means the final prospectus
      qualifying in certain Provinces of Canada the distribution of the Shares
      to be issued upon the voluntary or deemed exercise of the Special
      Warrants;

	
       
	
       
	
       

	
       
	
      (h) 
	
      “Group” means a group of beneficial owners within
      the meaning of Section 13(d) of the U.S. Securities Exchange Act and the
      rules and regulations of the SEC promulgated thereunder;

	
       
	
       
	
       

	
       
	
      (i) 
	
      “NYSE MKT” means the NYSE MKT Stock
    Exchange;

	
       
	
       
	
       

	
       
	
      (j) 
	
      “Registration Rights Agreement” means the
      agreement attached as Schedule “D” to the Subscription Agreement which is
      to be entered into between the Company and each of the Special Warrant who
      is or becomes a U.S. Person;

	
       
	
       
	
       

	
       
	
      (k) 
	
      “Resale Filings” means the Final Prospectus and
      the U.S. Registration Statement;

	
       
	
       
	
       

	
       
	
      (l) 
	
      “Resale Filings Termination Date” means for each
      holder of Special Warrants the second anniversary of the issuance date
      shown on the first page of the Special Warrant certificate.

	
       
	
       
	
       

	
       
	
      (m) 
	
      “SEC” means the United States Securities and
      Exchange Commission;

	
       
	
       
	
       

	
       
	
      (n) 
	
      “Securities Commissions” means, collectively, the
      Canadian securities commission or other securities regulatory authority in
      each of the Provinces where a Final Prospectus is filed;

	
       
	
       
	
       

	
       
	
      (o) 
	
      “Securities Laws” means the securities laws,
      regulations, rules, and instruments adopted by the securities regulator as
      applicable in each Designated Province and the U.S. Securities Act and the
      U.S. Exchange Act and the rules and regulations of the SEC promulgated
      under the U.S. Securities Act and the U.S. Exchange Act and the policies
      of the TSX and NYSE MKT;

	
       
	
       
	
       

	
       
	
      (p) 
	
      “Shares” means common shares without par value in
      the capital of the Company of the type listed on the TSX and NYSE
    MKT;

	
       
	
       
	
       

	
       
	
      (q) 
	
      “Subscription Agreement means the subscription
      agreement to purchase Special Warrants dated on or about August, 2015 and
      executed between Northern Dynasty Minerals Ltd. and the original holder of
      the Special Warrants;

	
       
	
       
	
       

	
       
	
      (r) 
	
      “TSX” means the Toronto Stock Exchange;

	
       
	
       
	
       

	
       
	
      (s) 
	
      “Underlying Shares” means the Shares to be issued
      on the voluntary or deemed exercise of the Special Warrants;

	
       
	
       
	
       

	
       
	
      (t) 
	
      “U.S. Exchange Act” means the U.S. Securities
      Exchange Act of 1934, as amended;

	
       
	
       
	
       

	
       
	
      (u) 
	
      “U.S. Person” has the meaning ascribed thereto in
      Rule 902(k) of Regulation S promulgated under the U.S. Securities
    Act;







15 

	
       
	
      (v) 
	
      “U.S. Registration Statement” means a registration
      statement on Form F-3 or other appropriate securities registration form
      filed with the SEC to permit the resale within the United States of the
      Underlying Shares; and

	
       
	
       
	
       

	
       
	
      (w) 
	
      “U.S. Securities Act” the United States
      Securities Act of 1933, as amended.







APPENDIX “A” 

VOLUNTARY EXERCISE FORM 

	TO: 	NORTHERN DYNASTY MINERALS LTD.
  


The undersigned registered holder of the within Special
Warrants hereby irrevocably exercises the right to acquire_____________ Underlying Shares of
Northern Dynasty Minerals Ltd. (the "Company") (or such number of other
securities or property to which Special Warrants entitle the undersigned in lieu
thereof or in addition thereto) in accordance with and subject to the provisions
of the annexed Special Warrant Certificate. 

DATED ___ this day of _______________,
201__. 

	Signature Guaranteed
    	 	Signature
      (Signature of Special Warrantholder to be 
	  	 	the same as appears on the face of the Special
    
	  	 	Warrant Certificate) 
	  	 	  
	  	 	  
	  	 	(Name in Full – Please Print)



Notes: 

	
      (1) 
	
      Underlying Shares will be issued in the name of the
      registered holder and delivered to the address of the registered holder as
      it appears on the Special Warrant register unless otherwise
    directed.



Instructions: The registered holder may exercise its
right to receive Underlying Shares by completing this form and surrendering this
form and the Special Warrant Certificate representing the Special Warrants being
exercised to the Company at its office at 15th Floor, 1040 West
Georgia Street, Vancouver, BC V6E 4H1, Attention: Trevor Thomas. Certificates
for Underlying Shares will be made available for pick-up or, at the request of
the holder, delivered or mailed within five (5) business days after the exercise
of the Special Warrants. If the Exercise Form is signed by a Company, executor,
administrator, curator, guardian, attorney, officer of a Company or any person
acting in a fiduciary or representative capacity, the certificate must be
accompanied by evidence of authority to sign satisfactory to the Company. 

The above signed hereby directs that
the said Underlying Shares be issued and registered as follows: 

Name(s) in Full:
______________________________________________________________________

Address(es) in Full:
___________________________________________________________________

(including postal code) ________________________________________________________________

No. of Underlying
  Shares:_________________________________

Note: If further nominees are intended, please attach (and
initial) schedule giving these particulars. 

BY VOLUNTARILY EXCERCISING THIS SPECIAL WARRANT YOU WILL RECEIVE
UNDERLYING 
SHARES THAT MAY BE SUBJECT TO RESALE RESRICTIONS




17 

APPENDIX “B” 

FORM OF DECLARATION FOR REMOVAL OF LEGEND 

	
      TO: 
	
      Northern Dynasty Minerals Ltd. (the "Company")
    

	
       
	
       

	
      TO: 
	
      Registrar and transfer agent for the shares of the
      Company 



The undersigned (A) acknowledges that the sale of the
securities of the Company to which this declaration relates is being made in
reliance on Rule 904 of Regulation S under the United States Securities Act of
1933, as amended (the "U.S. Securities Act"), and (B) certifies that (1) the
undersigned is not (a) an "affiliate" of the Company (as that term is defined in
Rule 405 under the U.S. Securities Act) (b) a "distributor" as defined in
Regulation S or (c) an affiliate of a distributor; (2) the offer of such
securities was not made to a person in the United States and either (a) at the
time the buy order was originated, the buyer was outside the United States, or
the seller and any person acting on its behalf reasonably believed that the
buyer was outside the United States, or (b) the transaction was executed on or
through the facilities of the Toronto Stock Exchange and neither the seller nor
any person acting on its behalf knows that the transaction has been prearranged
with a buyer in the United States; (3) neither the seller nor any affiliate of
the seller nor any person acting on their behalf has engaged or will engage in
any directed selling efforts in the United States in connection with the offer
and sale of such securities; (4) the sale is bona fide and not for the purpose
of "washing off" the resale restrictions imposed because the securities are
“restricted securities” (as that term is defined in Rule 144(a)(3) under the U.
S. Securities Act); (5) the seller does not intend to replace such securities
with fungible unrestricted securities; and (6) the contemplated sale is not a
transaction, or part of a series of transactions, which, although in technical
compliance with Regulation S, is part of a plan or scheme to evade the
registration provisions of the U. S. Securities Act. Terms used herein have the
meanings given to them by Regulation S under the U.S. Securities Act. 

	Dated _______________ 20__. 		X
      ______________________________________
	  	  	Signature of individual (if Purchaser is
      an individual) 
	 	 	 
	  	  	X
      ________________________________________
	  	  	Authorized signatory (if Purchaser is not
      an individual) 
	 	 	 
	  	  	________________________________________ 
	  	  	Name of
      Purchaser (please print) 
	 	 	 
	  	  	________________________________________ 
	  	  	Name of authorized signatory (please
      print) 
	 	 	 
	  	  	________________________________________ 
	  	  	Official capacity of authorized signatory
      (please print) 


Affirmation by Seller’s Broker-Dealer 

We have read the foregoing representations of our customer,
_________________________(the "Seller") dated _______________________, with
regard to the sale, for such Seller’s account, of the
_________________represented bycertificate number ______________of the Company
described therein, and we hereby affirm that, to the best of our knowledge and
belief, the facts set forth therein are full, true and correct.

Name of Firm 

	 	Name of Firm 	 
	 	 	 
	By: 	 	 
	 	Authorized Officer 	 
	 	 	 
	Dated: 	____________________ 20__. 	 






18 

APPENDIX “C” 

SPECIAL WARRANT EXERCISE BLOCKER INITIATION AND TERMINATION
FORM 

	TO: 	NORTHERN DYNASTY MINERALS LTD.
  


                        The undersigned registered holder of ___________Special
Warrants represented by Special Warrant certificate No.______________hereby
notifies you that it wishes to effect the following action in connection with
the blocker provisions contained in section 1(h) or 1(i) of the Special Warrant
Certificate. The undersigned elects to hereby: (tick applicable box)

	
       
	
      [  ]
	
      A. 
	
      give 61 days’ notice to cancel the 9.99% blocker
      contemplated by section 1(h); 

	
       
	
       
	
       
	
       

	
       
	
      [  ]
	
      B. 
	
      elects to be governed by the 9.99% blocker contemplated
      by section 1(h) effective immediately; OR 

	
       
	
       
	
      
	
	
       
	
      [  ]
	
      C. 
	
      give 61 days’ notice to cancel the 4.99% blocker
      contemplated by section 1(i). 



DATED _____ this day
of__________________ , 201__. 

	Signature (Signature
      of Special Warrantholder to be 	 
	the same as appears on the face of the Special 	 
	Warrant Certificate) 	 
	  	 
	  	 
	(Name in Full – Please Print) 	 


Send Completed Form to:

15th Floor, 1040 West Georgia Street,
Vancouver, BC, V6E
4H1,
Attention: Trevor Thomas, 
Tel: (604) 684-6365 
Fax: (604)
684-8092 
Trevor Thomas [TrevorThomas@hdimining.com]