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Yellowknives First Nation P.o. Box 2514, , NT X1A 2P8

th August 26 • 2010

Gordon Clarke Vice President, North Arrow Minerals Suite 204, 2817-49th Street Yellowknife, NT XIA 3S7 F: (867) 873-8493

Dear Mr Clarke:

Rc: North Arrow - Lac de Gras (MV2010C0039)

The Yellowknives Dene First Nation (YKDFN) is pleased with the initial Memorandum of th Understanding that you sent on August 20 , 2010. It represented a significant step forward and the YKDFN appreciate the sense of collaboration and openness that has been developing between our respective organizations.

After a review of the draft MOU by our leadership and legal council it was noted some items of concern to us had not been included in the draft. We have added these into a revised draft MOU. We are enclosing it for your consideration and are open to your thoughts and comments. If you have any questions, please contact YKDFN Lands and Environment at 766-3496.

Sincerely,

Chief Edward Sangris Chief Ted Tsetta Yellowknives Dene First Nation () Yellowknives Dene First Nation (Dettah)

Copy: Todd Slack, YKDFN Land and Environment, Yellowknife NT, Fax (867) 766~3497 Steve Ellis, IMA Implementation Office - Lutsc1 K'c NT, 1-888-7 14-3209 OS-27-10;12 ' 30PM ; # :;v 6

DRAFT MOU AS OF AUGUST 26, 2010

MEMORANDUM OF UNDERSTANDING

BETWEEN

North Arrow Minerals Inc.

AND

The Yellow knives Dene First Nation

WITH RESPECT TO

Related to North Arrow Minerals Inc's Lac de Gras MineraI Exploration Project

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DRAFI' MOU AS OF AUGUST 26, 2010

Memorandum of Understanding

THIS AGREEMENT made effective ______,2010, is made

BETWEEN

North Arrow Minerals Inc. a company incorporated under the laws of the and having an office at 169 Wilkinson Cres, Yellowknife, NT, Canada XIA 3V2

(hereinafter referred to as "North Arrow")

AND

Yellowknives Dene First Nation an Indian Band established pursuant to the Indian Act, R.S.C. 1985, c.I-S as represented by its Chief and Council, and a signatory to

(hereinafter referred to as the "Yellowknives")

WHEREAS:

North Arrow is a public company listed On the TSX Venture Exchange and subject to the rules and regulations of the securities commission; and

North Arrow maintains certain mineral claims and mining leases in the Lac de Gras area (the "Lac de Gras Project") and is entitled to mineral rights on these claims and leases subject to the terms and conditions of the Canada Mining Regulations; and

Yellowknives have recognized aboriginal Treaty Eight rights in the Lac de Gras area, including the area of the Lac de Gras Projcct; and

Yellowknives have communicated concerns to North Arrow in regard to specific concerns relating to North Arrow's proposed exploration activities at the Lac de Gras Project.

THEREFORE, in consideration of the promises, covenants and agreements set out herein and other good and valuable consideration North Arrow and the Yellowknives agree to the following:

1. OBJECTIVE OF & SCOPE· MEMORANDUM OF UNDERSTANDING ("MOU")

This objective of this MOD is to address consultation and accommodation terms related to North Arrow's exploration activity for the Lac de Gras Project and their enforceability.

The scope of this MOU is for North Arrow's exploration activity as set out in their land use application and including the airborne survey, ground geophysical survey, and exploratory diamond drilling.

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DRAFT MOU AS OF AUGUST 26,2010 2. ACCOMODATION MEASURES

2.1 Negotiation Costs - Upon execution of this MOU, North Arrow will pay to the Yellowknives $5,000,00 in respect of the costs incurred by the Yellowknives with the negotiation of this MOU and $20,000,00 in respect of compensation for impacts,

2.2 Option to Purchase - North An-ow will provide the Yellowknives with an option to purchase a 50% interest in the mineral claims and leases, at a price equal to 50% of the costs of North Arrow for those claims and leases, with the Yellowknives having the option to purchase within three (3) months after seeing the aerial survey results,

2.3 Contracts - North Arrow will award aerial survey, helicopter transport, site services, secmity and safety contracts to Dcton'Cho Corporation, Deton'eho Logistics, Trinity Helicopters (entities controlled by the Yellowknives) or a similar business arrangement involving the Yellowknives (the "First Nation Entity"), subject to demonstration to the satisfaction of North Arrow, acting reasonably, of their capacity to carry out the work and do so at a reasonable cost. North Arrow will notify the Yellowknives of all contracting opportunities at the same time as it notifies any other party of the same,

2.4 Yearly Report - For each year of exploration activity, North Arrow will submit an information report by January 31 st The report will include the types of information as outlined in the Mineral Exploration Guidelines in the Akaitcho Territory, part C, paragraph 6 as well as aerial survey results, proposed upcoming activities and field expense reports.

2.5 Yearly Meetings - For each year of operations North Arrow will meet witb a representative of the Yellowknives to review operations and discuss exploration results and future plans. This th meeting will be held between Aprill 51 and May 30

2.6 Site Visit - One Yellowknives member will visit the site during the operational period and report back to the First Nation, Whenever possible, this visit will occur in conjunction with regular company logistics,

2.7 Archaeology - An accredited archaeologist will inspect both the camp location and any potential drill sites prior to distmbance. During this work, one Yellowknives member (or designate) will accompany the archaeologist to assist their work as well as provide protection. North Arrow will promptly inform the Yellowknives should any archaeological sites be found.

2.8 Low Level Flights - North Arrow will restrict the amount of low level flights below an altitude of 300 metres, agreeing, not to conduct these types of transits while caribou are in the vicinity,

2.9 Wildlife Monitor - NOlth AlTOW will employee a wildlife monitor under terms mutually agreeable between North Arrow, the Yellowknives and Lutsel K'e Dene First Nation,

2.10 Work Stoppage - North ArTOW will cease drilling operations when groups of caribou are within 1000 m, A group will be defined as 25 or more animals,

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DRAFT MOU AS OF AUGUST 26, 2010 2.11 Transfer of Commitments - North Arrow agrees that any transfer or assumption of the management or ownership of the Lac de Gras Project to any Third Party wilt be subject to the Third Party providing YKDFN with a written undertaking, in a form acceptable to YKDFN, to continue to operate the Lac de Gras Project in compliance with the accommodations and conditions outlined in this MOU.

2.12 BCR for Approval- This MOU is subject to approval by the Yellowknives by way of a Band Council Resolution.

2.13 Term - The term of this MOU commences on the date hereof and expires on the earlier of December 2015 or completion of the exploration work.

Agreed to and accepted this ~_ of August, 2010.

Chief Edward Sangris Yellowknives Dene First Nation (Dettah)

Chief Ted Tsetta Yellowknivcs Dene First Nation (Ndilo)

Gordon Clarke, Vice President Exploration North Arrow Minerals Inc.

018932111

(Via Fax)

Yellowknives Dene First Nation P.O. Box 2514 Yellowknife, NT X1A 2P8

September 4th, 2010

Dear Chiefs Sangris and Tsetta:

Re: North Arrow – Lac de Gras (MV2010C0039)

Thank you for your letter dated August 26th, 2010. We have reviewed the letter and the attached revised Memorandum of Understanding (MOU). We were very surprised to see the content of clauses 2.1 (Negotiation Costs) and 2.2 (Option to Purchase) of the MOU as both concepts are entirely new. Neither concept was mentioned or discussed during our meeting of August 4th nor in any related written or oral communication received by North Arrow from the Yellowknives Dene First Nation (YKDFN). In fact, your letter dated August 12th, 2010 clearly stated that the YKDFN acknowledged that North Arrow had, to date, proposed sound measures to accommodate the concerns of YKDFN with the exception of two outstanding issues – enforceability of the accommodation measures and caribou protection. North Arrow, in my letter of August 20th, and accompanying MOU, subsequently agreed to your suggested resolutions and both of these outstanding issues were addressed in the MOU in clause 2.8 (Transfer of Commitments) and clause 2.7 (Work Stoppage). In your most recent MOU draft these are clauses 2.11 and 2.10 respectively.

We would respectfully appreciate being informed as to why, at this late date, the concepts of Negotiation Costs and Option to Purchase have been brought forward. Fortunately, our impression is that the inclusion of these items at this juncture in no way engenders the development of a “sense of collaboration and openness” between North Arrow and the YKDFN.

169 Wilkinson Cres, Yellowknife, NT, Canada X1A 3V2 Tel: (867) 873-8483 Cell: (867) 445-6527

North Arrow is committed to open, honest and fair dialogue with stake holders in the areas in which we explore and as such we remain committed to, and willing to move forward with, the accommodation measures covered in my letter and draft MOU of August 20th.

Sincerely,

North Arrow Minerals Inc. Per:

Gordon Clarke Vice-President Exploration

cc. Ray Griffith Director Wildlife, Lands and Environment LKDFN (via email) cc. Todd Slack YKDFN Land and Environment (via email) cc. Tyree Mullaney MVLWB (via email) cc. Julie Jackson INAC (via email) cc. Don Aubrey INAC (via email) cc. Mike Byrne INAC (via email)

169 Wilkinson Cres, Yellowknife, NT, Canada X1A 3V2 Tel: (867) 873-8483 Cell: (867) 445-6527