Mr. Steven Osterberg reports

TIMBERLINE RESOURCES CLOSES FINAL TRANCHE OF EQUITY FINANCING

Timberline Resources Corp. has closed the third and final tranche of its previously announced non-brokered private placement, for which it has received final approval from the TSX Venture Exchange.

In connection with the closing of the third and final tranche of the offering, the company has issued 3,076,734 units at a price of 15 U.S. cents for gross consideration of $461,510 (U.S.). In the three tranches of the offering that have closed, the company issued a total of 10,000,006 units for total consideration of $1.5-million (U.S.).

Each unit in the offering consisted 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 was completed under Rule 506(c) of Regulation D promulgated by the U.S. Securities and Exchange Commission under the Securities Act of 1933, as amended, solely to persons who qualify as accredited investors. Subscribers who were resident in Canada were required to qualify as accredited investors under Canadian National Instrument 45-106 prospectus exemptions.

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 was paid by Timberline in relation to this transaction to support the marketing of this offering of units.

The securities offered in the offering are subject to a four-month hold period pursuant to applicable Canadian securities laws and TSX Venture Exchange policies. The securities sold in the third and final tranche are subject to a hold period expiring on Nov. 1, 2016.

Insiders of the company have acquired 331,733 units under the offering. Their participation is considered to be a related party transaction within the meaning of TSX-V Policy 5.9 and Canadian Multilateral Instrument 61-101. The company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) in respect of insider participation as neither the fair market value of any shares issued to nor the consideration paid by such persons will exceed 25 per cent of the company's market capitalization.

We seek Safe Harbor.