True North Copper (ASX:TNC) agreed to sell its Bundarra copper project in Queensland to Tec Minerals for AU$500,000 in cash and AU$1 million worth of shares in the listed entity in Tec Minerals' proposed initial public offering or reverse takeover, according to a Monday filing with the Australian bourse.

True North Copper retained a 1% net smelter return royalty over future copper production at the project, with Tec Minerals having the right to repurchase the royalty for AU$3 million, per the filing.

The deal is subject to Tec Minerals undertaking an IPO or being acquired in a reverse takeover, as well as regulatory approvals.