Dreadnought Resources' (ASX:DRE) Dreadnought Exploration subsidiary signed a binding term sheet with Kingfisher Mining (ASX:KFM) to acquire 100% of its interest in 12 granted exploration licenses in Western Australia, according to a Monday filing with the Australian bourse.

The transaction involves an upfront consideration of AU$2 million in shares, half of which will be subject to voluntary escrow for 12 months from the date of issue, the filing said.

Kingfisher Mining is also entitled to AU$1.5 million in potential milestone payments based on resource definitions within the tenements, per the filing.

Kingfisher Mining shares fell 2% in afternoon trade on Monday.