Untitled Document


Exhibit 4.2


WARRANT NO. ___ 

 To Purchase
  100,000 Shares of Common Stock

  of

  WITS BASIN PRECIOUS MINERALS INC. 


      	This Warrant and the Securities issuable upon exercise of this Warrant have not been registered under the Securities Act of 1933 (the “1933 Act”) or under any state securities or “Blue Sky” laws
(“Blue Sky Laws”).  No transfer, sale, assignment, pledge, hypothecation or other disposition of this Warrant or the Securities issuable upon exercise of this Warrant or any interest therein may be made except (a) pursuant to an effective
registration statement under the 1933 Act and any applicable Blue Sky Laws or (b) if the Corporation has been furnished with an opinion of counsel for the holder, which opinion and counsel shall be reasonably satisfactory to the Corporation, to the
effect that no registration is required because of the availability of an exemption from registration under the 1933 Act and applicable Blue Sky laws. 


      	THIS CERTIFIES THAT, for good and valuable consideration [	], a Minnesota resident (the “Holder”), or the Holder’s registered assigns, is entitled to subscribe for and purchase
from Wits Basin Precious Minerals Inc., a Minnesota corporation (the “Corporation”), at any time on or after May 28, 2004, to and including May 28, 2009 (subject to the limitations provided in Section 10 below), 100,000 fully paid and
nonassessable shares of the Common Stock of the Corporation at the price of $0.40 per share (the “Warrant Exercise Price”), subject to the anti-dilution and price protection provisions, and the special adjustments in Section 11, of this
Warrant. 


     The shares which may be acquired upon exercise of this Warrant are referred to herein as the “Warrant Shares.”  As used herein, the term “Holder” means the Holder, any party who acquires all or a part of this
Warrant as a registered transferee of the Holder, or any record holder or holders of the Warrant Shares issued upon exercise, whether in whole or in part, of the Warrant. The term “Common Stock” means the common stock, $0.01 par value per
share, of the Corporation. 


     This Warrant is subject to the following provisions, terms and conditions: 

 1.     Exercise;
  Transferability.
  


     (a) 	The rights represented by this Warrant may be exercised by the Holder hereof, in whole or in part (but not as to a fractional share of Common Stock), by written notice of exercise (in the form attached hereto) delivered to
the Corporation at the principal office of the Corporation prior to the expiration of this Warrant and accompanied or preceded by the surrender of this Warrant along with a check in payment of the Warrant Exercise Price for such Warrant Shares.










     (b) 	Except as provided in Section 7 hereof, this Warrant may not be sold, transferred, assigned, hypothecated or divided into two or more Warrants of smaller denominations, nor may any Warrant Shares issued pursuant to exercise
of this Warrant be transferred. In no event may this Warrant be transferred and divided (without any exercise hereof) into any denomination(s) of less than 100 Warrant Shares. 

 2.     Exchange
  and Replacement.
  Subject to Sections 1 and 7 hereof, this Warrant is exchangeable upon the surrender
  hereof by the Holder to the Corporation at its office for new Warrants of like
  tenor and date representing in the aggregate the right to purchase the number
  of Warrant Shares purchasable hereunder, each of such new Warrants to represent
  the right to purchase such number of Warrant Shares (not to exceed the aggregate
  total number purchasable hereunder) as shall be designated by the Holder at
  the time of such surrender. Upon receipt by the Corporation of evidence reasonably
  satisfactory to it of the loss, theft, destruction or mutilation of this Warrant,
  and, in case of loss, theft or destruction, of indemnity or security reasonably
  satisfactory to it, and upon surrender and cancellation of this Warrant, if
  mutilated, the Corporation will make and deliver a new Warrant of like tenor,
  in lieu of this Warrant. This Warrant shall be promptly canceled by the Corporation
  upon the surrender hereof in connection with any exchange or replacement. The
  Corporation shall pay all expenses, taxes (other than stock transfer taxes),
  and other charges payable in connection with the preparation, execution, and
  delivery of Warrants pursuant to this Section 2. 

 3.     Issuance
  of the Warrant Shares.
  


     (a) 	The Corporation agrees that the Warrant Shares shall be and are deemed to be issued to the Holder as of the close of business on the date on which this Warrant shall have been surrendered and the payment made for such
Warrant Shares as aforesaid.  Subject to the provisions of paragraph (b) of this Section 3, certificates for the Warrant Shares so purchased shall be delivered to the Holder within a reasonable time after the rights represented by this Warrant shall
have been so exercised, and, unless this Warrant has expired, a new Warrant representing the right to purchase the number of Warrant Shares, if any, with respect to which this Warrant shall not then have been exercised shall also be delivered to the
Holder. 

      (b)
  Notwithstanding the foregoing, however, the Corporation shall not be required
  to deliver any certificate for Warrant Shares upon exercise of this Warrant
  except in accordance with exemptions from the applicable securities registration
  requirements or registrations under applicable securities laws. Except as described
  in Section 9, nothing herein shall obligate the Corporation to effect registrations
  under federal or state securities laws. If registrations are not in effect and
  if exemptions are not available when the Holder seeks to exercise the Warrant,
  the Warrant exercise period will be extended, if need be, to prevent the Warrant
  from expiring, until such time as either registrations become effective or exemptions
  are available, and the Warrant shall then remain exercisable for a period of
  at least 30 calendar days from the date the Corporation delivers to the Holder
  written notice of the availability of such registrations or exemptions. The
  Holder agrees to execute such documents and make such representations, warranties
  and agreements as may be required solely to comply with the exemptions relied
  upon by the Corporation, or the registrations made, for the issuance of the
  Warrant Shares. 




 4.      Covenants
  of the Corporation. The
  Corporation covenants and agrees that all Warrant Shares will, upon issuance,
  be duly authorized and issued, fully paid, non-assessable and free from all
  taxes, liens and charges with respect to the issue thereof. The Corporation
  further covenants and agrees that during the period within which the rights
  represented by this Warrant may be exercised, the Corporation will at all times
  have authorized and reserved for the purpose of issue or transfer upon exercise
  of the subscription rights evidenced by this Warrant a sufficient number of
  shares of Common Stock to provide for the exercise of the rights represented
  by this Warrant. 

 5.      Anti-dilution
  Adjustments. The
  provisions of this Warrant are subject to adjustment as provided in this Section
  5. 


     (a) 	Stock Splits, Dividends and Combinations. The Warrant Exercise Price shall be adjusted from time to time such that in case the Corporation shall hereafter: 

           (i)
  pay any dividends on any class of stock of the Corporation payable in Common
  Stock or securities convertible into Common Stock; 

           (ii)
  subdivide its then outstanding shares of Common Stock into a greater number
  of shares; or 

           (iii)
  combine outstanding shares of Common Stock, by reclassification or otherwise;
  

 then, in any such event,
  the Warrant Exercise Price in effect immediately prior to such event shall (until
  adjusted again pursuant hereto) be adjusted immediately after such event to
  a price (calculated to the nearest full cent) determined by dividing (A) the
  number of shares of Common Stock outstanding immediately prior to such event,
  multiplied by the then existing Warrant Exercise Price, by (B) the total number
  of shares of Common Stock outstanding immediately after such event (including
  in each case the maximum number of shares of Common Stock issuable in respect
  of any securities convertible into Common Stock), and the resulting quotient
  shall be the adjusted Warrant Exercise Price per share. An adjustment made pursuant
  to this Subsection shall become effective immediately after the record date
  in the case of a dividend or distribution and shall become effective immediately
  after the effective date in the case of a subdivision, combination or reclassification.
  If, as a result of an adjustment made pursuant to this
  Subsection, the Holder of any Warrant thereafter surrendered for exercise shall
  become entitled to receive shares of two or more classes of capital stock or
  shares of Common Stock and other capital stock of the Corporation, the Board
  of Directors (whose determination shall be conclusive) shall determine the allocation
  of the adjusted Warrant Exercise Price between or among shares of such classes
  of capital stock or shares of Common Stock and other capital stock. All calculations
  under this Subsection shall be made to the nearest cent or to the nearest 1/100
  of a share, as the case may be. In the event that at any time as a result of
  an adjustment made pursuant to this Subsection, the holder of any Warrant thereafter
  surrendered for exercise shall become entitled to receive any shares of the
  Corporation other than shares of Common Stock, thereafter the Warrant Exercise
  Price of such other shares so receivable upon exercise of any Warrant shall
  be subject to adjustment from time to time in a manner and on terms as nearly
  equivalent as practicable to the provisions with respect to Common Stock contained
  in this Section. 





     (b) 	Mechanics of Adjustment for Stock Splits, Dividends and Combinations. Upon each adjustment of the Warrant Exercise Price pursuant to Section 5(a) above, the Holder
of each Warrant shall thereafter (until another such adjustment) be entitled to purchase at the adjusted Warrant Exercise Price the number of shares, calculated to the nearest full share, obtained by multiplying the number of shares specified in
such Warrant (as adjusted as a result of all adjustments in the Warrant Exercise Price in effect prior to such adjustment) by the Warrant Exercise Price in effect prior to such adjustment and dividing the product so obtained by the adjusted Warrant
Exercise Price. 

      (c)
  Consolidations,
  Mergers and Reorganization Events.
  In case of any consolidation or merger to which the Corporation is a party other
  than a merger or consolidation in which the Corporation is the continuing corporation,
  or in case of any sale or conveyance to another corporation of the property
  of the Corporation as an entirety or substantially as an entirety, or in the
  case of any statutory exchange of securities with another corporation (including
  any exchange effected in connection with a merger of a third corporation into
  the Corporation), there shall be no adjustment under Subsection (a) of this
  Section 5; but the Holder of each Warrant then outstanding shall have the right
  thereafter to convert such Warrant into the kind and amount of shares of stock
  and other securities and property which he would have owned or have been entitled
  to receive immediately after such consolidation, merger, statutory exchange,
  sale or conveyance had such Warrant been converted immediately prior to the
  effective date of such consolidation, merger, statutory exchange, sale or conveyance
  and, in any such case, if necessary, appropriate adjustment shall be made in
  the application of the provisions set forth in this Section with respect to
  the rights and interests thereafter of any Holders of the Warrant, to the end
  that the provisions set forth in this Section shall thereafter correspondingly
  be made applicable, as nearly as may reasonably be, in relation to any shares
  of stock and other securities and property thereafter deliverable on the exercise
  of the Warrant. The provisions of this Subsection
  shall similarly apply to successive consolidations, mergers, statutory exchanges,
  sales or conveyances. 





     (d) 	Adjustments for Diluting Issues.  In addition to the adjustments of the Warrant Exercise Price provided above, the Warrant Exercise Price shall be subjected to
further adjustment from time to time as follows (the main operative provision hereof is in Section 5(d)(iii) below): 

           (i)
  Special Definitions:
  

                (A)
  “Options”
  shall mean rights, options or warrants (other than as excluded by Section 5(d)(i)(D)
  below) to subscribe for, purchase or otherwise acquire either Common Stock or
  Convertible Securities (as defined herein). 

                (B)
  “Original Issue
  Date” shall
  mean the date hereof.

                (C)
  “Convertible
  Securities”
  shall mean securities (other than as excluded by (4) below) convertible, either
  directly or indirectly, into or exchangeable for Common Stock. 

                (D)
  “Additional
  Shares of Common Stock”
  shall mean all shares of Common Stock issued (or, deemed to be issued) by the
  Corporation after the Original Issue Date other than shares of Common Stock
  issued (or deemed to be issued): 

                     1.
  to employees, consultants or directors pursuant to stock option, stock grant,
  stock purchase or similar plans or arrangements approved by the Corporation’s
  Board of Directors; 

                     2.
  as a dividend or other distribution in connection with which an adjustment to
  the Warrant Exercise Price is made; 

                     3.
  in a merger, consolidation, acquisition or similar business combination that
  is approved by the Corporation’s Board of Directors; 

                     4.
  pursuant to credit, lease or other commercial financing arrangements with parties
  not affiliated with the Corporation that are approved by the Corporation’s
  Board of Directors; 

                     5.
  in exchange for technology or other non-cash assets as approved by the Corporation’s
  Board of Directors; 

                     6.
  pursuant to any rights or agreements outstanding on the Original Issue Date;
  or 



                     7.
  if the Holder agrees in writing that such shares shall not constitute Additional
  Shares of Common Stock. 




           (ii)
  Deemed Issue of
  Additional Shares of Common Stock.
  Except as otherwise provided in Section 5(d), in the event the Corporation at
  any time or from time to time after the Original Issue Date shall issue any
  Options or Convertible Securities or shall fix a record date for the determination
  of any holders of any class of securities entitled to receive any such Options
  or Convertible Securities, then the maximum number of shares (as set forth in
  the instrument relating thereto without regard to any provisions contained therein
  for a subsequent adjustment of such number) of Common Stock issuable upon the
  exercise of such Options or, in the case of Convertible Securities and Options
  therefor, the conversion or exchange of such Convertible Securities, shall be
  deemed to be Additional Shares of Common Stock issued as of the time of such
  issue or, in case such record date shall have been fixed, as of the close of
  business on such record date, provided that in any such case in which Additional
  Shares of Common Stock are deemed to be issued: 

                (A)
  no further adjustment in the Warrant Exercise Price shall be made upon the subsequent
  issue of such Convertible Securities or shares of Common Stock upon the exercise
  of such Options or conversion or exchange of such Convertible Securities; 

                (B)
  if such Options or Convertible Securities by their terms provide, with the passage
  of time or otherwise, for any increase or decrease in the consideration payable
  to the Company, or increase or decrease in the number of shares of Common Stock
  issuable upon the exercise, conversion or exchange thereof, the Warrant Exercise
  Price computed upon the original issue thereof or upon the occurrence of a record
  date with respect thereto, and any subsequent adjustments based thereon, shall,
  upon any such increase or decrease becoming effective, be recomputed to reflect
  such increase or decrease; 

                (C)
  upon the expiration of any such Option or any rights of conversion or exchange
  under such Convertible Securities which shall not have been exercised, the Warrant
  Exercise Price computed upon the original issue thereof or upon occurrence of
  a record date with respect thereto, and any subsequent adjustments based thereon,
  shall, upon such expiration: 

                     1.
  in the case of Convertible Securities or Options for Common Stock, be recomputed
  as though the only Additional Shares of Common Stock issued were shares of Common
  Stock, if any, actually issued upon the exercise of such Options or the conversion
  or exchange of such Convertible Securities, and the consideration received therefor
  was the consideration actually received by the Company for the issue of all
  such Options, whether or not exercised, plus the consideration actually received
  by the Company upon such exercise, or for the issue of all such Convertible
  Securities, whether or not converted or exchanged, plus the additional consideration,
  if any, actually received by the Company upon such conversion or exchange; and
  

                     2.
  in the case of Options for Convertible Securities, be recomputed as though only
  the Convertible Securities, if any, actually issued upon the exercise
  thereof were issued at the
  time of issue of such Options and the consideration received by the Company
  for the Additional Shares of Common Stock deemed to have been then issued was
  the consideration actually received by the Company for the issue of all such
  Options, whether or not exercised, plus the consideration deemed to have been
  received by the Company upon the issue of the Convertible Securities with respect
  to which such Options were actually exercised. 




                (D)
  no readjustment pursuant to Section 5(d) shall have the effect of increasing
  the Warrant Exercise Price to an amount which exceeds the Warrant Exercise Price
  existing immediately prior to the original adjustment with respect to the issuance
  of such Options or Convertible Securities, as adjusted for any Additional Shares
  of Common Stock issued (or deemed to be issued) between such original adjustment
  date and such readjustment date; and 

                (E)
  in the case of any Option or Convertible Security with respect to which the
  maximum number of shares of Common Stock issuable upon exercise or conversion
  or exchange thereof is not determinable, no adjustment to the Warrant Exercise
  Price shall be made until such number becomes determinable. 

           (iii)
  Adjustments for
  Issuance of Additional Shares of Common Stock. If
  the Company, at any time after the issuance of this Warrant, shall issue any
  Additional Shares of Common Stock (otherwise than as provided in the Sections
  5(a) and 5(c) above) at a price per share less than the applicable Warrant Exercise
  Price then in effect or without consideration, then the applicable Warrant Exercise
  Price upon each such issuance shall be adjusted to that price (rounded to the
  nearest cent) determined by multiplying the applicable Warrant Exercise Price
  then in effect by a fraction, (i) the numerator of which shall be equal to the
  sum of (A) the number of shares of Common Stock outstanding immediately prior
  to the issuance of such Additional Shares of Common Stock plus
  (B) the number of shares of Common Stock (rounded to the nearest whole share)
  which the aggregate consideration for the total number of such Additional Shares
  of Common Stock so issued would purchase at a price per share equal to the applicable
  Warrant Exercise Price then in effect, and (ii) the denominator of which shall
  be equal to the number of shares of Common Stock outstanding immediately after
  the issuance of such Additional Shares of Common Stock. 

      The
  provisions of this Section 5(d)(iii) shall not apply under any of the circumstances
  for which an adjustment is provided in Sections 5(a), 5(b) or 5(c) above. No
  adjustment of the applicable Warrant Exercise Price shall be made under this
  Section 5(d) upon the issuance of any Additional Shares of Common Stock which
  are issued pursuant to any Options or Convertible Securities if upon the issuance
  of such Options or Convertible Securities (x) any adjustment shall have been
  made pursuant to Section 5(d)(ii) above or (y) no adjustment was required pursuant
  to this Section 5(d)(iii). No adjustment of the applicable Warrant Exercise
  Price shall be made under this Section 5(d)(iii) in an amount less than $.01
  per share, but any such lesser adjustment shall be carried forward and shall
  be made at the time and together with the next subsequent adjustment, if any,
  which together with any adjustments so carried
  forward shall amount to $.01 per share or more; provided,
  however,
  that upon any adjustment of the applicable Warrant Exercise Price as a result
  of any dividend or distribution payable in Common Stock or Convertible Securities
  or the reclassification, subdivision or combination of Common Stock into a greater
  or smaller number of shares, the foregoing figure of $.01 per share (or such
  figure as last adjusted) shall be adjusted (to the nearest one-half cent) in
  proportion to the adjustment in the applicable Warrant Exercise Price. 




           (iv)
  Determination of
  Consideration.
  For purposes of this Section 5(d), the consideration received by the Corporation
  for any Additional Shares of Common Stock issued (or deemed to be issued) shall
  be computed as follows: 

                (A)
  Cash and Property.
  Such consideration shall: 

                     (i)
  insofar as it consists of cash, be computed at the aggregate amount of cash
  received by the Company; 

                     (ii)
  insofar as it consists of securities and the value of such securities is not
  determinable by reference to a separate agreement, (A) if the securities are
  then traded on a national securities exchange or the Nasdaq Stock Market (or
  a similar national quotation system), then the value shall be computed based
  on the average of the closing prices of the securities on such exchange or system
  over the thirty (30)-day period ending on the date of receipt by the Corporation,
  (B) if the securities are actively traded over-the-counter, then the value shall
  be computed based on the average of the closing bid prices over the thirty (30)
  day ending on the date of receipt by the Corporation, and (C) if there is no
  active public market, then the value shall be computed based on the fair market
  value thereof on the date of receipt by the Corporation, as determined in good
  faith by the Board of Directors; 

                     (iii)
  insofar as it consists of property other than cash and securities, be computed
  at the fair market value thereof at the time of such issuance, as determined
  in good faith by the Board of Directors; and 

                     (iv)
  if Additional Shares of Common Stock are issued (or deemed to be issued) together
  with other shares or securities or other assets of the Corporation for consideration
  which cover both, by the proportion of such consideration so received, computed
  as provided in the immediately preceding Sections 5(d)(iv)(A)(i), 5(d)(iv)(A)(ii)
  and 5(d)(iv)(A)(iii), as determined in good faith by the Board of Directors.
  

                (B)
  Options and Convertible
  Securities. The
  consideration received by the Corporation for Additional Shares of Common Stock
  deemed to have been issued pursuant to Section 5(d) relating to Option and Convertible
  Securities, shall be the sum of (x) the total amount, if any, received or receivable
  by the Corporation as consideration for the issue of such Options or Convertible
  Securities, plus (y) the minimum aggregate amount of additional consideration
  (as set forth in the instruments relating thereto, without regard to any provision
  contained therein for a subsequent adjustment of such consideration) payable
  to the Corporation upon the exercise of such Options or the conversion or exchange
  of such Convertible Securities, or in the case of Options for Convertible Securities,
  the exercise of such Options for Convertible Securities and the conversion or
  exchange of such Convertible Securities.





     (e) 	Default. For purposes of a secured convertible promissory note of this date (the “Note”) issued by the Corporation to the original Holder hereof, this Warrant is in
default if the Corporation fails by November 28, 2004 (the “Registration Deadline”) to obtain effectiveness under the 1933 Act and applicable state securities laws of a registration statement for the benefit of the Holder under the terms of a
Registration Rights Agreement of this date covering all of the Warrant Shares hereunder and all of the shares of Common Stock issuable as payment under or upon conversion of the Note. Despite the foregoing, if the Holder consents (as provided under
the Registration Rights Agreement) to an extension of the effective date of the Registration Statement beyond November 28, 2004, then the Registration Deadline hereunder shall be extended by a like period. 


     (f) 	Certificate as to Adjustments.  Upon the occurrence of each adjustment or readjustment of the Warrant Exercise Price or the number of Warrants covered hereby
pursuant to this Section 5 or pursuant to Section 11 below, the Corporation, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to the Holder a certificate setting forth such
adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the written request at any time of the Holder, furnish or cause to be furnished to the Holder a like
certificate setting forth (i) such adjustments and readjustments, (ii) the Warrant Exercise Price at the time in effect, and (iii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received
upon the exercise of this Warrant.

 6.      No
  Voting Rights. This
  Warrant shall not entitle the Holder to any voting rights or other rights as
  a shareholder of the Corporation. 

 7.
       Notice
  of Transfer of Warrant or Resale of the Warrant Shares.
  

      (d)
  Subject to the sale, assignment, hypothecation or other transfer restrictions
  set forth in Section 1 hereof, the Holder, by acceptance hereof, agrees to give
  written notice to the Corporation before transferring this Warrant or transferring
  any Warrant Shares of such Holder’s intention to do so, describing briefly
  the manner of any proposed transfer. Promptly upon receiving such written notice,
  the Corporation shall present copies thereof to the Corporation’s counsel.
  If in the opinion of such counsel the proposed transfer may be effected without
  registration or qualification (under any federal or state securities laws),
  the Corporation, as promptly as practicable, shall notify the Holder of such
  opinion, whereupon the Holder shall be entitled to transfer this Warrant or
  to dispose of Warrant Shares received upon the previous exercise of this Warrant,
  all in accordance with the terms of the notice delivered by the Holder to the
  Corporation; provided that an appropriate legend may be endorsed on this Warrant
  or the certificates for such Warrant Shares respecting restrictions upon transfer
  thereof necessary or advisable in the opinion of counsel and satisfactory to
  the Corporation to prevent further transfers which would be in violation of
  Section 5 of the 1933 Act and applicable state securities laws; and provided
  further that the prospective transferee or purchaser shall execute such documents
  and make such representations, warranties and agreements as may be required
  solely to comply with the exemptions relied upon by the Corporation for the
  transfer or disposition of the Warrant or Warrant Shares. 





     (e) 	If, in the opinion of the Corporation’s counsel, the proposed transfer or disposition of this Warrant or such Warrant Shares described in the written notice given pursuant to this Section 7 may not be effected without
registration or qualification of this Warrant or such Warrant Shares, the Corporation shall promptly give written notice thereof to the Holder, and the Holder will limit its activities in respect to such transfer or disposition as, in the opinion of
such counsel, are permitted by law. 

 8.      Fractional
  Shares. Fractional
  shares shall not be issued upon the exercise of this Warrant, but in any case
  where the holder would, except for the provisions of this Section, be entitled
  under the terms hereof to receive a fractional share, the Corporation shall,
  upon the exercise of this Warrant for the largest number of whole shares then
  called for, pay a sum in cash equal to the sum of (a) the excess, if any, of
  the Market Price of such fractional share over the proportional part of the
  Warrant Exercise Price represented by such fractional share, plus (b) the proportional
  part of the Warrant Exercise Price represented by such fractional share. For
  purposes of this Section, the term “Market Price” with respect to
  shares of Common Stock of any class or series means the last reported sale price
  or, if none, the average of the last reported closing bid and asked prices on
  any national or regional securities exchange or quoted in the National Association
  of Securities Dealers, Inc.’s Automated Quotations System (“Nasdaq”),
  or if not listed on a national or regional securities exchange or quoted in
  Nasdaq, the average of the last reported closing bid and asked prices as reported
  by Metro Data Corporation, Inc. or the OTC Bulletin Board from quotations by
  market makers in such Common Stock on the Minneapolis-St. Paul local over-the-counter
  market, or if no quotations in such Common Stock are available, the fair market
  value of the shares as determined in good faith by the Board of Directors of
  the Corporation. 

 9.      Registration
  Rights. Holder
  shall have registration rights for the shares underlying its Warrants as described
  in the Registration Rights Agreement of this same date. 

 10.      Limitation
  of Exercise of this Warrant.
  Despite anything to the contrary in this Warrant,
  the Holder may not exercise this Warrant during the time period and to the extent
  that the shares of Common Stock that the Holder could acquire upon the exercise
  hereof would cause Holder’s Beneficial Ownership (as defined below) of
  the Corporation’s Common Stock to exceed 4.99%. These limitations on the
  right to exercise this Warrant shall first reduce the Holder’s Beneficial
  Ownership of the Corporation’s Common Stock before limitation of the Holder’s
  conversion rights, or the Corporation’s right to make payments in Common
  Stock, under the Note. The parties shall compute the Holder’s "Beneficial
  Ownership" of Common Stock in accordance with U.S. Securities and Exchange Commission
  Rule 13d-3. The Holder will, at the request of the Corporation, from time to
  time, notify the Corporation of the Holder’s computation of Holder’s
  Beneficial Ownership.




 11.      Special
  Adjustment in Warrant Exercise Price. Despite
  the foregoing provisions of this Warrant, if the U.S. Securities and Exchange
  Commission (the “SEC”) declares the Corporation’s Registration
  Statement on Form S-2, SEC File No. 333-110831 (the “S-2 Registration Statement”),
  effective on or before July 1, 2004 (the date of any such effectiveness being
  the "Effective Date”), the Warrant Exercise Price hereunder shall be adjusted
  (before any other adjustments otherwise provided in this Warrant) effective
  as of the 31st trading day after the Effective Date, as follows. The adjusted
  Warrant Exercise Price shall equal 115% (rounded to the nearest $0.01) of the
  greater of: 


        (i)
    $0.35 or 

        (ii)
    the lower of (x) $0.65 or (y) the average (rounded to the nearest $0.01) of
    the high closing bid prices of the Corporation’s Common Stock on the
    OTC Bulletin Board as reported by bigcharts.com (or if this service is discontinued,
    such other reporting service acceptable to Holder) for the 30 trading days
    immediately following the Effective Date. 



      The
  Warrant Exercise Price shall be adjusted simultaneously to equal 115% of the
  Computation Price (rounded to the nearest $0.01). 


     If on or before July 1, 2004, the SEC has not declared the S-2 Registration Statement effective, then there shall be no adjustment in the Warrant Exercise Price pursuant to this Section 11. 

      IN
  WITNESS WHEREOF,
  Wits Basin Precious Minerals Inc. has caused this Warrant to be signed by its
  duly authorized officer and this Warrant to be dated May 28, 2004.

	 	WITS BASIN
      PRECIOUS MINERALS INC.
	 	 	 
	 	By 	/s/ Mark
      D. Dacko 
	 	 	

	 	 	Mark D.
      Dacko,

      Chief Financial Officer