Mr. Steven Osterberg reports

TIMBERLINE RESOURCES CLOSES SECOND TRANCHE OF EQUITY FINANCING

Timberline Resources Corp. has closed the second tranche of its non-brokered private placement, for which it previously received conditional approval from the TSX Venture Exchange, by issuing 3,741,603 units for a total of $561,240 (U.S.). In the two tranches of the offering that have closed, the company has issued 6,923,272 units for a total of $1,038,490 (U.S.). A final tranche is expected to close in mid-June.

The offering, which was initially announced on May 11, 2016, and modified to a larger offering amount with an announcement on May 26, 2016, consists of up to 10 million units at a price of 15 U.S. cents for a total of $1.5-million (U.S.). Each unit consists of one share of common stock of the company and one common share purchase warrant, with each warrant exercisable to acquire an additional share of common stock of the company at a price of 25 U.S. cents per share until May 31, 2019.

The offering is being completed under Rule 506(c) of Regulation D promulgated by the Securities and Exchange Commission under the Securities Act of 1933, as amended, solely to persons who qualify as accredited investors.

The company intends to use the net proceeds of the offering for working capital, exploration program expenses, costs associated with claim maintenance and loan repayments.

A consulting fee may be payable by Timberline in relation to this transaction to support in marketing this offering of units.

We seek Safe Harbor.