UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2023
For the quarterly period ended December 31, 2023
OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-34055

TIMBERLINE RESOURCES CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Delaware		82-0291227
(State of other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
101 EAST LAKESIDE AVENUE
9030 NORTH HESS ST., SUITE 161
COEUR D’ALENE, Idaho		83814
HAYDEN, ID		83835
(Address of Principal Executive Offices)		(Zip Code)

(208) 664-4859

(Registrant’s Telephone Number, including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Common Stock, $0.001 par value

TLRS

TBR

OTCQB

TSX-V

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large Accelerated Filer	☐	Accelerated Filer	☐
Non-Accelerated Filer	☒	Small Reporting Company	☒
		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ☐ Yes ☒ No

Number of shares of issuer’s common stock outstanding at ~~August~~February 1113, ~~2023~~2024: ~~159~~189,~~676~~996,152

INDEX

Page PART I — FINANCIAL INFORMATION 3 ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 3 Contents 3 ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. 12 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 22 ITEM 4. CONTROLS AND PROCEDURES 22 PART II — OTHER INFORMATION 24 ITEM 1. LEGAL PROCEEDINGS. 24 ITEM 1A. RISK FACTORS 24 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS. 24 ITEM 3. DEFAULTS UPON SENIOR SECURITIES. 24 ITEM 4. MINE SAFETY DISCLOSURES 24 ITEM 5. OTHER INFORMATION 24 SIGNATURES 26

		Page

PART I — FINANCIAL INFORMATION

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)		F-1

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.		3

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		7

ITEM 4. CONTROLS AND PROCEDURES		7

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.		8

ITEM 1A. RISK FACTORS		8

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.		8

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.		8

ITEM 4. MINE SAFETY DISCLOSURES		8

ITEM 5. OTHER INFORMATION		8

SIGNATURES		10

Table of Contents

PART I — FINANCIAL INFORMATION

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIES

Contents
	Page
FINANCIAL STATEMENTS (UNAUDITED):
Condensed consolidated balance sheets	4
Condensed consolidated statements of operations	5
Condensed consolidated statements of changes in stockholders’ equity	6
Condensed consolidated statements of cash flows	7
Notes to condensed consolidated financial statements	8 - 11

Contents

3 Table of Contents

		Page

FINANCIAL STATEMENTS (UNAUDITED):

Condensed Consolidated balance sheets		F-2

Condensed Consolidated statements of operations		F-3

Condensed Consolidated statements of changes in stockholders’ equity		F-4

Condensed Consolidated statements of cash flows		F-5

Notes to condensed consolidated financial statements		F-6 - F-8

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
	June 30, 2023			September 30, 2022
ASSETS
CURRENT ASSETS:
Cash	$	172,416		$	2,438,587
Prepaid expenses and other current assets		32,946			18,444
TOTAL CURRENT ASSETS		205,362			2,457,031
PROPERTY, MINERAL RIGHTS AND EQUIPMENT, net		14,127,178			13,980,855
OTHER ASSETS:
Reclamation bonds		528,643			528,643
Deposits and other assets		5,700			5,700
TOTAL OTHER ASSETS		534,343			534,343
TOTAL ASSETS	$	14,866,883		$	16,972,229
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	76,827		$	639,994
Accrued expenses		4,204			22,214
Accrued interest – related party		104,998			57,966
Accrued payroll, benefits and taxes		38,480			42,143
Senior unsecured note payable – related party		270,991			270,991
TOTAL CURRENT LIABILITIES		495,500			1,033,308
LONG-TERM LIABILITIES:
Asset retirement obligation		142,325			124,159
TOTAL LONG-TERM LIABILITIES		142,325			124,159
TOTAL LIABILITIES		637,825			1,157,467
COMMITMENTS AND CONTINGENCIES (Note 7)		-			-
STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value; 10,000,000 shares authorized, no shares issued and outstanding		-			-
Common stock, $0.001 par value; 500,000,000 shares authorized, 159,676,152 and 159,676,152 shares issued and outstanding, respectively		159,676			159,676
Additional paid-in capital		90,029,519			89,955,640
Accumulated deficit		(75,960,137	)		(74,300,554	)
TOTAL STOCKHOLDERS' EQUITY		14,229,058			15,814,762
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	14,866,883		$	16,972,229

F-1

Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

	December 31, 2023			September 30, 2023
ASSETS
CURRENT ASSETS:
Cash	$	541,493		$	98,224
Prepaid expenses and other current assets		16,029			8,130
TOTAL CURRENT ASSETS		557,522			106,354

Property, mineral rights, and equipment, net		14,173,178			14,155,178

OTHER ASSETS:
Reclamation bonds		528,643			528,643
Deposits and other assets		1,200			5,700
TOTAL OTHER ASSETS		529,843			534,343

TOTAL ASSETS	$	15,260,543		$	14,795,875

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	93,775		$	83,867
Accrued expenses		9,022			6,245
Accrued payroll, benefits and taxes		172,744			123,943
TOTAL CURRENT LIABILITIES		275,541			214,055

LONG-TERM LIABILITIES:
Asset retirement obligation		145,840			144,040
TOTAL LONG-TERM LIABILITIES		145,840			144,040
TOTAL LIABILITIES		421,381			358,095

COMMITMENTS AND CONTINGENCIES (Note 6)		-			-

STOCKHOLDERS' EQUITY:
Preferred stock, $ 0.01 par value; 10,000,000 shares authorized, no shares issued and outstanding		-			-
Common stock, $ 0.001 par value; 500,000,000 shares authorized, 189,996,152 and 174,246,152 shares issued and outstanding, respectively		189,996			174,246
Additional paid-in capital		91,362,351			90,744,432
Accumulated deficit		(76,713,185	)		(76,480,898	)
TOTAL STOCKHOLDERS' EQUITY		14,839,162			14,437,780

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	15,260,543		$	14,795,875

The accompanying notes are an integral part of these condensed consolidated financial statements.

4F-2 Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
	Three months ended						Nine months ended
	Three months endedDecember 31,
	June 30,						June 30,
	2023			2022
	2023			2022			2023			2022
OPERATING EXPENSES:
OPERATING EXPENSES:
Mineral exploration	$	59,247		$	522,643
Mineral exploration	$	108,761		$	896,465		$	727,827		$	2,696,797
Salaries and benefits		77,690			112,164
Salaries and benefits		88,363			71,819			278,840			219,750
Professional fees		59,462			62,859
Professional fees		58,393			61,234			171,904			155,938
Insurance expense		13,967			44,528
Insurance expense		40,821			43,204			125,739			116,651
Other general and administrative		21,513			127,902
Other general and administrative		80,477			149,748			313,156			332,254
TOTAL OPERATING EXPENSES		231,879			870,096
TOTAL OPERATING EXPENSES		376,815			1,222,470			1,617,466			3,521,390
LOSS FROM OPERATIONS		(231,879	)		(870,096	)
LOSS FROM OPERATIONS		(376,815	)		(1,222,470	)		(1,617,466	)		(3,521,390	)
OTHER INCOME (EXPENSE):
OTHER INCOME (EXPENSE):
Foreign exchange gain (loss)		(156	)		3,402
Foreign exchange gain (loss)		648			(214,347	)		6,931			(210,683	)
Interest expense – related party		-			(15,151	)
Interest expense		(~~1,049~~271	)		~~(503~~-	)		~~(2,530~~	)		~~(1,636~~	)
Interest expense – related party		(16,381	)		(13,701	)		(47,031	)		(39,337	)
Other income		19			302
Miscellaneous other income		56			72			513			151
TOTAL OTHER INCOME (EXPENSE)		(408	)		(11,447	)
TOTAL OTHER INCOME (EXPENSE)		(16,726	)		(228,479	)		(42,117	)		(251,505	)
LOSS BEFORE INCOME TAXES		(232,287	)		(881,543	)
LOSS BEFORE INCOME TAXES		(393,541	)		(1,450,949	)		(1,659,583	)		(3,772,895	)
INCOME TAX PROVISION (BENEFIT)		-			-
INCOME TAX PROVISION (BENEFIT)		-			-			-			-
NET LOSS	$	(232,287	)	$	(881,543	)
NET LOSS	$	(393,541	)	$	(1,450,949	)	$	(1,659,583	)	$	(3,772,895	)
NET LOSS PER SHARE BASIC AND DILUTED	$	(0.00	)	$	(0.01	)
NET LOSS PER SHARE
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED		174,588,543			159,676,152
BASIC AND DILUTED	$	nil		$	(0.01	)	$	(0.01	)	$	(0.03	)
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING, BASIC AND DILUTED		159,676,152			159,468,089			159,676,152			146,378,612

The accompanying notes are an integral part of these condensed consolidated financial statements.

5F-3 Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)For the three and nine months ended June 30, 2023 and 2022
TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)
							Additional									Total
	Common Stock						AdditionalPaid-in			Accumulated			TotalStockholders’
	Common Stock						Paid-in			Subscription			Accumulated			Stockholders’
	Shares			Amount			Capital			Deficit			Equity
	Shares			Amount			Capital			Receivable			Deficit			Equity
Balance, September 30, 2023		174,246,152		$	174,246		$	90,744,432		$	(76,480,898	)	$	14,437,780
Balance, September 30, 2022		159,676,152		$	159,676		$	89,955,640		$	-		$	(74,300,554	)	$	15,814,762
Stock based compensation		-			-			3,669			-			3,669
Stock based compensation		-			-			51,708			-			-			51,708
Common stock issued for cash and warrants		15,750,000			15,750			614,250			-			630,000
Net loss		-			-			-			-(232,287	)		(~~881~~232,~~543~~287	)		~~(881,543~~	)
Balance December 31, 2022		159,676,152		$	159,676		$	90,007,348		$	-		$	(75,182,097	)	$	14,984,927
Balance December 31, 2023		189,996,152		$	189,996		$	91,362,351		$	(76,713,185	)	$	14,839,162
Stock based compensation		-			-			11,087			-			-			11,087
Net loss		-			-			-			-			(384,499	)		(384,499	)
Balance, March 31, 2023		159,676,152		$	159,676		$	90,018,435		$	-		$	(75,566,596	)	$	14,611,515
Stock based compensation		-			-			11,084			-			-			11,084
Net loss		-			-			-			-			(393,541	)		(393,541	)
Balance, June 30, 2023		159,676,152		$	159,676		$	90,029,519		$	-		$	(75,960,137	)	$	14,229,058
							Additional									Total
	Common Stock			Paid-in			Subscription			Accumulated			Stockholders’
	Shares			Amount			Capital			Receivable			Deficit			Equity
Balance, September 30, 2021		139,696,022		$	139,696		$	85,345,213		$	-		$	(68,338,647	)	$	17,146,262
Stock based compensation		-			-			44,321			-			-			44,321
Net loss		-			-			-			-			(1,624,223	)		(1,624,223	)
Balance December 31, 2021		139,696,022		$	139,696		$	85,389,534		$	-		$	(69,962,870	)	$	15,566,360
Common stock issued for exercise of warrants		1,546,425			1,546			214,953			(70,000	)		-			146,499
Net loss		-			-			-			-			(697,723	)		(697,723	)
Balance, March 31, 2022		141,242,447		$	141,242		$	85,604,487		$	(70,000	)	$	(70,660,593	)	$	15,015,136
Common stock issued for cash, net		18,933,705			18,934			4,420,653			-			-			4,439,587
Refund of subscription receivable		(500,000	)		(500	)		(69,500	)		70,000			-			-
Net loss		-			-			-			-			(1,450,949	)		(1,450,949	)
Balance, June 30, 2022		159,676,152		$	159,676		$	89,955,640		$	-		$	(72,111,542	)	$	18,003,774

	Common Stock				Additional Paid-in		Accumulated			Total Stockholders’
	Shares		Amount		Capital		Deficit			Equity
Balance, September 30, 2022		159,676,152	$	159,676	$	89,955,640	$	(74,300,554	)	$	15,814,762
Stock based compensation		-		-		51,708		-			51,708
Net loss		-		-		-		(881,543	)		(881,543	)
Balance, December 31, 2022		159,676,152	$	159,676	$	90,007,348	$	(75,182,097	)	$	14,984,927

The accompanying notes are an integral part of these condensed consolidated financial statements.

6F-4 Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
	Nine months Ended June 30,
	Three months Ended December 31,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(1232,~~659,583~~287	)	$	(3881,~~772,895~~543	)
Adjustments to reconcile net loss to net cash used by operating activities:
Stock-based compensation		733,~~879~~669			4451,~~321~~708
Accretion of asset retirement obligation		51,~~145~~800			41,~~434~~715
Changes in assets and liabilities:
Prepaid expenses and other current assets		(147,~~502~~899	)		(2152,~~858~~655	)
Accounts payable		(563,167	)		19,310
Deposits and other assets		4,500			-
Accrued expenses		(18,010	)		(22,946	)
Accounts payable		9,908			(574,188	)
Accrued expenses – related party		-			19,790
Accrued expenses		2,777			(10,032	)
Accrued interest – related party		~~47,032~~-			3915,~~337~~151
Accrued payroll, benefits and taxes		(348,~~663~~801	)		(3,~~946~~663	)
Net cash used by operating activities		(2168,~~132,869~~731	)		(31,~~686~~453,~~561~~507	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of mineral rights		(54,000	)		(54,000	)
Payments for mineral rights		(18,000	)		(18,000	)
Refund of reclamation bond		-			10,053
Purchase of mineral rights		-			(10,933	)
Payments for mineral rights		(79,302	)		-
Net cash used by investing activities		(18,000	)		(28,933	)
Net cash used by investing activities		(133,302	)		(43,947	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock and warrants, net		-			4,439,587
Proceeds from sale of common stock and warrants		630,000			-
Proceeds from exercise of warrants		-			146,499
Net cash provided by financing activities		630,000			-
Net cash provided by financing activities		-			4,586,086
Net increase (decrease) in cash and cash equivalents		443,269			(1,482,440	)
Net increase (decrease) in cash and cash equivalents		(2,266,171	)		855,578
CASH AT BEGINNING OF PERIOD		98,224			2,438,587
CASH AT BEGINNING OF PERIOD		2,438,587			3,327,352
CASH AT END OF PERIOD	$	541,493		$	956,147
CASH AT END OF PERIOD	$	172,416		$	4,182,930

The accompanying notes are an integral part of these condensed consolidated financial statements.

7F-5 Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL ~~STATEMENTSJune~~STATEMENTSDecember 3031, 2023 (Unaudited)

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS:

Timberline Resources Corporation (“Timberline” or “the Company) was incorporated in August of 1968 under the laws of the State of Idaho as Silver Crystal Mines, Inc., for the purpose of exploring for precious metal deposits and advancing them to production. In 2008, the Company reincorporated into the State of Delaware, pursuant to a merger agreement approved by its shareholders.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

a. Basis of Presentation and Going Concern – The unaudited condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information, as well as the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of the Company’s management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair statement of the interim condensed consolidated financial statements have been included. Operating results for the ~~nine~~three-month period ended ~~June~~December 3031, 2023 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, ~~2023~~2024.

For further information refer to the consolidated financial statements and footnotes thereto in the Company’s Annual Report on Form 10-K/A ~~as amended~~ for the year ended September 30, ~~2022~~2023.

The accompanying condensed consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company has incurred losses since its inception. The Company does not have sufficient cash to fund normal operations and meet all of its obligations for the next 12 months without raising additional funds. ~~and~~However, ~~fund~~we ~~planned~~are an exploration company with exploration programs that require significant cash expenditures. A significant drilling program, such are those we have planned, can result in depletion of cash and return us to a position of insufficient cash to support normal operations for 12 months. The Company currently has no historical recurring source of revenue, and its ability to continue as a going concern is dependent on its ability to raise equity and/or debt capital to fund future exploration and working capital requirements, or the Company’s ability to profitably execute its business plan. The Company’s plans for the long-term return to and continuation as a going concern include financing its future operations through sales of common stock, Company assets and/or debt and the eventual profitable exploitation of its mining properties. While the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms acceptable to the Company. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. If the going concern basis were not appropriate for these condensed consolidated financial statements, adjustments would be necessary in the carrying value of assets and liabilities, the reported expenses and the balance sheet classifications used.

b. New Accounting Pronouncements -– ~~Accounting~~In ~~standards~~August ~~that~~2023, ~~have~~the ~~been~~Financial Accounting Standards Board issued orAccounting ~~proposed~~Standards byUpdate ~~FASB~~(“ASU”) 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, which clarifies the business combination accounting for joint venture formations. The amendments in the ASU seek to reduce diversity in practice that dohas ~~not~~resulted ~~require~~from ~~adoption~~a ~~until~~lack of authoritative guidance regarding the accounting for the formation of joint ventures in separate financial statements. The amendments also seek to clarify the initial measurement of joint venture net assets, including businesses contributed to a ~~future~~joint venture. The guidance is applicable to all entities involved in the formation of a joint venture. The amendments are effective for all joint venture formations with a formation date on or after January 1, 2025. Early adoption and retrospective application of the amendments are permitted. We do not ~~expected~~expect adoption of the new guidance to have a material impact on ~~the~~our ~~condensed~~ consolidated financial statements ~~upon~~and ~~adoption~~disclosures.

c.In ~~Principles~~November of2023, ~~Consolidation~~the –Financial ~~The~~Accounting ~~condensed~~Standards ~~consolidated~~Board ~~financial~~(“FASB”) ~~statements~~issued Accounting Standards Update 2023-07 (“ASU 2023-07”), Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, amending reportable segment disclosure requirements to include disclosure of incremental segment information on an annual and interim basis. Among the ~~accounts~~disclosure ofenhancements are new disclosures regarding significant segment expenses that are regularly provided to the ~~Company~~chief operating decision-maker and ~~its~~included ~~wholly~~within ~~owned~~each ~~subsidiaries,~~reported BHmeasure ~~Minerals~~of ~~USA~~segment profit or loss, ~~Inc.;~~as ~~Lookout~~well ~~Mountain~~as ~~LLC;~~other ~~Wolfpack~~segment ~~Gold~~items ~~(Nevada)~~bridging ~~Corp~~segment revenue to each reported measure of segment profit or loss.; ~~Staccato~~The ~~Gold~~amendments ~~Resources~~in ASU 2023-07 are effective for fiscal years beginning after December 15, ~~Ltd.;~~2023, and ~~Talapoosa~~for ~~Development~~interim ~~Corp.,~~periods within fiscal years beginning after ~~elimination~~December 15, 2024, and are applied retrospectively. Early adoption is permitted. We are currently evaluating the impact of ~~intercompany~~this ~~accounts~~update on our consolidated financial statements and ~~transactions~~disclosures.

F-6

Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023 (Unaudited)

In December 2023, the FASB issued Accounting Standards Update 2023-09 (“ASU 2023-09”), Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.

Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption.

c. Principles of Consolidation – The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, BH Minerals USA, Inc.; Wolfpack Gold (Nevada) Corp.; Staccato Gold Resources, Ltd.; Lookout Mountain LLC, and Talapoosa Development Corp., after elimination of intercompany accounts and transactions.

d. Net Income (Loss) per Share – Basic earnings per share (“EPS”) is computed as net income (loss) available to common shareholders divided by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants, and other convertible securities.

The dilutive effect of outstanding securities as of ~~June~~December 3031, 2023 and 2022 is as follows:

	June 30, 2023		June 30, 2022
	December 31, 2023		December 31, 2022
Stock options		6,035,000		8,335,000
Warrants		3826,~~402~~785,~~384~~000		5750,~~414~~534,~~898~~031
Total potential dilution		4432,~~437~~820,~~384~~000		6558,~~749~~869,~~898~~031

At ~~June~~December 3031, 2023 and 2022, the effect of the Company’s common stock equivalents would have been anti-dilutive ~~and therefore are excluded in the calculation of diluted EPS~~.

8 Table of Contents

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSJune 30, 2023 (Unaudited)

NOTE 3 – PROPERTY, MINERAL RIGHTS, AND EQUIPMENT:

The following is a summary of property, mineral rights, and equipment and accumulated depreciation at ~~June~~December 3031, 2023 and September 30, ~~2022~~2023, respectively:

	Expected Useful Lives (years)		~~June~~December 3031, 2023			September 30, ~~2022~~2023
Mineral rights – Eureka		-	$	13,~~701~~747,838		$	13,~~647~~729,838
Mineral rights – Seven Troughs, New York Canyon and other		-		248,227			~~168~~248,~~925~~227
ARO Asset				125,636			~~112~~125,~~615~~636
Total mineral rights				14,~~075~~121,701			1314,~~929~~103,~~378~~701
Equipment and vehicles	2-5			53,678			53,678
Office equipment and furniture	3-7			70,150			70,150
Land		-		51,477			51,477
Total property and equipment				175,305			175,305
Less accumulated depreciation				(123,828	)		(123,828	)
Property, mineral rights, and equipment, net			$	14,~~127~~173,178		$	1314,~~980~~155,~~855~~178

Mineral rights at Eureka increased by $18,000 and $5418,000 for advanced royalty payments to Rocky ~~Canyon~~Mountain Mining Company atfor Lookout Mountain during the three-month ~~and~~periods ~~nine months~~ ended ~~June~~December 3031, 2023 and 2022, respectively. ~~At June 30, 2023 and 2022, the ARO asset and the ARO liability increased by $13,021 and $nil, respectively as a result of additional acreage disturbed at Eureka.~~ Depreciation expense for the three ~~and nine~~ months ended ~~June~~December 3031, 2023 and 2022, was $0 for each period.

~~New~~F-7 ~~York~~Table ~~Canyon:~~of Contents

OnTIMBERLINE ~~August~~RESOURCES ~~23,~~CORPORATION ~~2022,~~AND ~~the~~SUBSIDIARIESNOTES ~~Company~~TO ~~purchased~~CONDENSED ~~one~~CONSOLIDATED ~~patented~~FINANCIAL ~~mining~~STATEMENTSDecember ~~claim~~31, ~~comprising~~2023 of a total of 13.77 acres commonly known as the South Wales #1 patent within the New York Canyon claim block in Nevada’s Eureka trend, from Newmont Capital Limited for a total of $41,310. In conjunction with this purchase, the Company granted a 1.5% net smelter return royalty to the seller. (Unaudited)

OnNOTE ~~September~~4 ~~28,~~– ~~2022,~~COMMON ~~the Company purchased five patented mining claims~~STOCK, ~~comprising~~WARRANTS ofAND aPREFERRED total of 28.82 acres commonly known as the Tiger Lilly, Eureka Giant, Southern Cross, Maria and Best & Belcher patents with and near the New York Canyon claim block, from the University of Nevada, Reno Foundation for a total of $86,460. In conjunction with this purchase, the Company granted a 1.5% net smelter return royalty to the seller. Two of the patented claims are not within the New York Canyon claim block but will be included with this designation on the Company’s claims record references.STOCK:

~~During~~On ~~the~~December ~~fourth~~28, ~~quarter of fiscal 2022 and first quarter of fiscal~~ 2023, the Company ~~purchased~~closed ana ~~interest~~non-brokered inprivate ~~patented~~placement ~~claims~~to ~~within~~accredited ~~the~~investors ~~New~~at ~~York~~a ~~Canyon~~price ~~claim~~of ~~block from private parties for~~ $~~10,933~~0.04 Inper ~~conjunction~~unit. ~~with~~Units ~~the~~consist ~~purchase,~~of ~~the~~one ~~Company~~share ~~granted~~of acommon ~~0.5%~~stock ~~net~~and ~~smelter~~one ~~return~~series ~~royalty~~P towarrant ~~the sellers~~share. ~~During~~The ~~the~~Company ~~second~~issued ~~quarter of fiscal 2023~~15,750,000 ~~the~~common ~~Company~~shares ~~purchased~~and ana ~~interest~~like innumber ~~additional~~of ~~patented~~warrants ~~claims~~for ~~within~~cash ~~the~~proceeds ~~New~~of ~~York Canyon claim block from private parties for~~ $67630,~~237~~000. ~~During~~The ~~the~~warrants ~~third~~have ~~quarter~~a term of ~~fiscal~~four ~~2023,~~years ~~the~~and ~~Company~~are ~~purchased~~exercisable anat ~~interest~~$0.06 inper ~~additional~~common ~~patented claims within the New York Canyon claim block from private parties for $1,132~~share.

~~NOTE~~During 4the –quarter ~~SENIOR~~ended ~~UNSECURED~~December ~~NOTE~~31, ~~PAYABLE~~2023, –1,016,022 ~~RELATED~~series ~~PARTY:~~N warrants expired. During the quarter ended December 31, 2022, 2,880,867 series C warrants expired.

OnAt ~~July~~December 3031, ~~2018~~2023, the Company ~~entered~~has ~~into~~ a ~~loan~~total ~~agreement~~of ~~and promissory note with William Matlack~~26, ~~a significant shareholder and a director. Mr. Matlack loaned the Company $300~~785,000 inwarrants ~~the~~outstanding ~~form~~with of a ~~senior~~weighted ~~unsecured~~average ~~note~~exercise ~~payable,~~price ~~with the principal bearing interest at an annual rate~~ of ~~18%, compounded monthly~~$0.07 ~~The loan is unsecured~~ and ~~has~~ a ~~maturity~~weighted ~~date~~average ofremaining ~~January~~contractual ~~20,~~term ~~2023. On January 20, 2023, the Company entered into an agreement with Mr. Matlack to extend the due date~~ of ~~the note for a period of six months to mature on July 20, 2023, and again on July 31, 2023, agreed with Mr~~3.19 ~~Matlack to extend the due date of the note for another six months to January 2024~~years. ~~At June 30, 2023 and September 30, 2022, the senior unsecured note payable balance was $270,991.~~

9NOTE ~~Table~~5 of– ~~Contents~~STOCK-BASED AWARDS:

~~TIMBERLINE~~On ~~RESOURCES~~October ~~CORPORATION~~8, ~~AND~~2020, ~~SUBSIDIARIESNOTES~~the TOCompany ~~CONDENSED~~granted ~~CONSOLIDATED~~a ~~FINANCIAL~~total ~~STATEMENTSJune~~of 301,100,000 options to purchase shares of the Company’s common stock that expire in five years with an exercise price of $0.25 in conjunction with the appointment of officers and a director. These granted options had a total fair value of $259,985. These options vested immediately, with the exception of 750,000 options that vest at 25% upon grant with the remaining 75% vesting over a three-year period. At December 31, 2023, ~~(Unaudited)~~all options have fully vested. During the three months ended December 31, 2023 and 2022, $3,669 and $51,708 was expensed as share-based compensation.

The accrued interest on the senior unsecured note payable – related party was $104,998 and $57,966 at June 30, 2023 and September 30, 2022, respectively. Interest expense related to the senior unsecured notes payable to this related party was $16,381 and $13,701 for the three months ended June 30, 2023 and 2022, respectively, and $47,031 and $39,337 for the nine months ended June 30, 2023 and 2022, respectively.

The $270,991 senior unsecured note payable would be senior to any other debt obtained by the Company subsequent to September 30, 2021. The note requires that when the Company enters into any other financings, 25% of the proceeds of such financings will be paid toward reduction of the principal and interest accrued on this note. At May 2, 2022 and continuing through June 30, 2023, and again on July 31, 2023 and continuing through January 20, 2024. Mr. Matlack provided a waiver of default on the Note that would otherwise have existed due to a non-payment of cash from sales of common stock for cash under this contract term for the note.

NOTE 5 – COMMON STOCK AND WARRANTS:

During the nine months ended June 30, 2023, 2,880,867 Series C warrants, 4,000,000 Series K warrants, and 12,131,647 Series M warrants expired.

At June 30, 2023, the Company has a total of 38,402,384 warrants outstanding with a weighted average exercise price of $0.19 with a weighted average remaining contractual term of 0.50 years.

On May 2, 2022, the Company closed a non-brokered private placement of the Company to accredited investors at a price of $0.25 per common share. The Company issued 18,933,705 common shares for cash proceeds of $4,733,426. Finders fees in the amount of $293,839 and 1,016,022 Series N Warrants were paid and issued, respectively, to licensed brokers and consultants in association with the offering. The warrants have a term of 18 months and are exercisable at $0.25 per common share.

During the nine months ended June 30, 2022, 6,825,000 Series E warrants, 5,000,000 Series G warrants and 4,446,016 Series H warrants expired. Also, holders of Series H Warrants exercised 1,546,425 warrants for $0.14 per share to acquire 1,546,425 shares of the Company’s common stock for total cash proceeds of $146,499 and a subscription receivable of $70,000 to the Company. The warrant holder decided not to exercise the 500,000 warrants subscribed, the $70,000 was refunded and the warrants expired, resulting in a total of 1,046,425 shares being issued.

NOTE 6 – STOCK-BASED AWARDS:

The Company has a stock plan to issue up to 15,000,000 shares of common stock, including 10,000,000 shares of common stock reserved for incentive stock options. Upon exercise of options or other awards, shares are issued from the available authorized shares of the Company. Option awards are granted with an exercise price equal to the trading price of the Company’s stock at the date of grant.

On October 8, 2020, the Company granted a total of 1,100,000 options to purchase shares of the Company’s common stock that expire in five years with an exercise price of $0.25 in conjunction with the appointment of officers and a director. These granted options had a total fair value of $259,985. These options vested immediately, with the exception of 750,000 options that vest at 25% upon grant with the remaining 75% vesting over a three-year period. During the three and nine months ended June 30, 2023, $11,084 and $73,879, respectively, was expensed to share-based compensation, compared to $nil and $44,321 for the three and nine months ended June 30, 2022, respectively.

The following is a summary of options issued and outstanding:

	Options			Weighted Average Exercise Price
Outstanding at September 30, 2021		8,335,000			0.18
Outstanding at September 30, 2022		8,335,000			0.18
Granted		-			-
Expired		-(2,300,000	)		-(0.18	)
Outstanding at September 30, 2022		8,335,000		$	0.18
Outstanding at September 30, 2023		6,035,000		$	0.17
Granted		-			-
Expired		~~(2,300,000~~-	)		~~0.18~~-
Outstanding at June 30, 2023		6,035,000			0.18
Outstanding at December 31, 2023		6,035,000			0.17
Outstanding and exercisable at June 30, 2023		5,847,500		$	0.17
Outstanding and exercisable at December 31, 2022		6,035,000		$	0.17
Weighted average remaining contractual term (years)					21.0757

The aggregate of options exercisable as of ~~June~~December 3031, 2023 had anno intrinsic value ~~of $nil for both outstanding and vested options~~, based on the closing price of $0.0605 per share of the Company’s common stock on ~~June~~December 3031, 2023.

10NOTE ~~Table~~6 of– ~~Contents~~COMMITMENTS AND CONTINGENCIES:

TIMBERLINE RESOURCES CORPORATION AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSJune 30, 2023 (Unaudited)

NOTE 7 – COMMITMENTS AND CONTINGENCIES:

The Company has the following commitments and contingencies:

Mineral Exploration

A portion of the Company’s mining claims on the Company’s properties are subject to lease and option agreements including advance minimum royalty payments, with various terms, obligations, and royalties payable in certain circumstances.

The Company pays federal and county claim maintenance fees on unpatented claims that are included in the Company’s mineral exploration properties. Should the Company continue to explore all of the Company’s mineral properties, it estimates annual fees to total ~~approximately~~ $236,~~000~~277 per year in the future.

11F-8 Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

As used in herein, the terms “Timberline,” the “Company,” “we,” “us,” and “our” refer to Timberline Resources Corporation.

This discussion and analysis contains forward-looking statements that involve known or unknown risks, uncertainties and other factors that may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Except for historical information, the matters set forth herein, which are forward-looking statements, involve certain risks and uncertainties that could cause actual results to differ. Potential risks and uncertainties include, but are not limited to, unexpected changes in business and economic conditions; significant increases or decreases in gold prices; changes in interest and currency exchange rates; unanticipated grade changes; metallurgy, processing, access, availability of materials, equipment, supplies and water; results of current and future exploration and production activities; local and community impacts and issues; timing of receipt and maintenance of government approvals; accidents and labor disputes; environmental costs and risks; competitive factors, including competition for property acquisitions; and availability of external financing at reasonable rates or at all, and those set forth under the heading “Risk Factors” in our Form 10-K/A filed with the United States Securities and Exchange Commission (the “SEC”) on ~~July~~January 1217, ~~2023~~2024. Forward- looking statements can be identified by terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continues” or the negative of these terms or other comparable terminology. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance, or achievements. Forward-looking statements are made based on management’s beliefs, estimates, and opinions on the date the statements are made, and the Company undertakes no obligation to update such forward-looking statements if these beliefs, estimates, and opinions should change, except as required by law.

This discussion and analysis should be read in conjunction with the accompanying unaudited consolidated financial statements and related notes. The discussion and analysis of the financial condition and results of operations are based upon the unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of any contingent liabilities at the financial statement date and reported amounts of revenue and expenses during the reporting period. On an on-going basis the Company reviews its estimates and assumptions. The estimates were based on historical experience and other assumptions that the Company believes to be reasonable under the circumstances. Actual results are likely to differ from those estimates under different assumptions or conditions, but the Company does not believe such differences will materially affect our condensed consolidated financial position or results of operations. Critical accounting policies, the policies the Company believes are most important to the presentation of its consolidated financial statements and require the most difficult, subjective and complex judgments are outlined below in “Critical Accounting Policies” and have not changed significantly.

Corporate Overview

~~Our~~We are a mineral exploration business isand, if and when we establish mineral reserves, a development company. Mineral exploration inis ~~Nevada~~essentially ~~with~~a research activity that does not produce a ~~focus~~product. onSuccessful ~~district-scale~~exploration ~~gold~~often ~~projects~~results ~~such~~in asincreased ~~our~~project ~~Eureka~~value ~~Project,~~that ~~which~~can ~~includes~~be ~~our~~realized ~~material~~through ~~Lookout~~the ~~Mountain~~optioning ~~Project~~or selling of the claimed site to larger companies. We ~~are~~acquire ~~focused~~properties onwhich ~~discovery~~we believe have potential to host economic concentrations of ~~high-grade~~minerals, ~~Carlin-type~~particularly gold and ~~carbonate~~silver. ~~replacement-type~~These ~~silver-lead-zinc-gold~~acquisitions ~~deposits~~have ~~(CRD)~~and atmay ~~Eureka~~take the form of unpatented mining claims on federal land, or leasing claims on private property owned by others. ~~The~~An ~~Eureka~~unpatented ~~Property~~mining ~~includes~~claim is an interest that can be acquired in the ~~historic~~mineral ~~Lookout~~rights ~~Mountain~~on ~~and~~open ~~Windfall~~lands ~~Mines~~of the federally owned public domain. Claims are staked in aaccordance ~~total~~with ~~property~~the ~~position~~Mining Law of ~~approximately~~1872, 28recorded ~~square~~with ~~miles~~the federal government pursuant to laws and regulations established by the Bureau of Land Management (72the ~~square~~Federal ~~kilometers~~agency that administers America’s public lands), that grant the holder of the claim a possessory interest in the mineral rights, subject to the paramount title of the United States.

~~Lookout~~We ~~Mountain~~perform ~~Project~~geological work to identify specific drill targets on the properties, and then collect subsurface samples by drilling to confirm the presence of mineralization (the presence of economic minerals in a ~~material~~specific ~~property:~~area or geological formation). We may enter into option and joint venture agreements with other companies to fund further exploration and/or development work. It is our plan to focus on assembling a high-quality group of gold and silver exploration prospects using the experience and contacts of the management group. By such prospects, we mean properties that may have been previously identified by third parties, including prior owners such as exploration companies, as mineral prospects with potential for economic mineralization. Often these properties have been sampled, mapped and sometimes drilled, usually with indefinite results. Accordingly, such acquired projects will either have some prior exploration history or will have strong similarity to a recognized geologic ore deposit model. We place geographic emphasis on the western United States, and Nevada in particular.

A3 ~~technical~~Table report entitled, Technical Report on the Lookout Mountain Project, Eureka County, Nevada, USA, compliant with Canadian NI 43-101 (“2013 Technical Report”), was completed on March 1, 2013. The 2013 Technical Report was prepared by Mine Development Associates (MDA) of Reno, Nevada under the supervision of Michael M. Gustin, Senior Geologist, who is a qualified person under NI 43-101. The Technical Report details mineralization at the Lookout Mountain Deposit. In addition, significant exploration potential was noted. Contents

~~Subsequent~~SPECIAL toNOTE ~~the~~TO ~~filing~~READERS: ofLookout ~~the~~Mountain ~~Company’s~~is ~~Annual~~a ~~Report~~material onproperty ~~Form~~as ~~10-K~~defined onby ~~December 29, 2022, we re-engaged Mr. Gustin, most recently of RESPEC, to provide an updated report and summary to meet the standards of US Securities and Exchange Commission (SEC)~~ Regulation S-K Subpart 1300. ~~This technical report is entitled~~ (S-K 1300) ~~Technical~~issued ~~Report~~by ~~Summary:~~the ~~Lookout~~Security ~~Mountain Project, Eureka Property, Eureka, Nevada~~ and isExchange ~~dated~~Commission ~~June~~(SEC). ~~21,~~All ~~2023,~~other ~~with~~properties andescribed ~~effective~~in ~~date~~this ofAnnual ~~December~~Report ~~31,~~are ~~2022.~~immaterial ~~The~~under S-K 1300 ~~report updates the previous gold resource calculation to include the potential amenability of the resource to mining by open pit methods~~. ~~Key information from the Management Summary of the S-K 1300 Technical Report is included here:~~

12The ~~Table~~Eureka Project, includes the Lookout Mountain Property and the historical Lookout Mountain and Windfall Mines in a total property position of ~~Contents~~approximately 28 square miles (72 square kilometers). The Lookout Mountain mineral resource estimate was reported in compliance with Canadian NI 43-101 in an Updated Technical Report on the Lookout Mountain Project by Mine Development Associates, Effective March 1, 2013, filed on SEDAR April 12, 2013:

During the 2023 fiscal year, RESPEC Company LLC completed a mineral resource estimate and an initial Technical Report Summary (TRS) for the Lookout Mountain gold deposit. The TRS and mineral resource disclosure is a requirement of S-K ~~Mineral~~1300, ~~Resource~~which ~~Estimate~~governs US mining projects. The updated mineral resource estimate is summarized in Table 1. The resource estimate has been constrained by optimized open pits utilizing revenue and cost inputs as summarized in the Notes to Table 1 below:

~~The~~Table ~~gold resources at the Lookout Mountain project (Figure~~ 1), including the Lookout Mountain and South Adit deposits, were modeled and estimated by evaluating the drill data statistically, utilizing the geologic interpretations provided by Timberline to interpret mineral domains on cross sections spaced at 50- and 100-foot intervals, refining the mineral-domain interpretations on level plans spaced at 10-foot intervals, analyzing the modeled mineralization statistically to aid in the establishment of estimation parameters, and interpolating grades into a three-dimensional block model. ~~All~~Updated ~~modeling of the~~ Lookout Mountain ~~project~~Project ~~resources~~Gold ~~was performed using Gemcom Surpac® mining software.~~Resources

The Lookout Mountain project resources are presented in Table 2 below:

Table 2. Lookout Mountain Project Gold Resources

Notes:

· The ~~estimate of the Lookout Mountain project~~ Mineral Resources ~~was completed by RESPEC Company LLC of Reno, Nevada. · The Mineral Resources~~ are comprised of oxidized model blocks that lie within optimized pits at a cutoff grade of 0.005 oz Au/ton plus unoxidized blocks within the optimized pits at a 0.055 oz Au/ton cutoff. · Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. · The Mineral Resources are potentially amenable to open pit mining methods and are therefore constrained by optimized pits created using a gold price of US$1,800/oz, a throughput rate of 10,000 tons/day, assumed metallurgical recoveries of 80% for heap-leaching of oxidized materials and 86% for toll milling of unoxidized materials, a mining cost of US$2.50/ton, heap-leaching processing cost of $3.60/ton, toll milling cost of $80.00/ton, general and administrative costs of $0.83/ton processed, a reclamation cost of $0.25/ton processed, refining cost of $3.00/oz Au produced, and an NSR royalty of 3.5%. This study does not constitute an Initial Assessment under S-K 1300. · The effective date of the resource estimate is December 31, 2022. · Rounding may result in apparent discrepancies between tons, grade, and contained metal content. · The Technical Report Summary is authored by Steven Osterberg, PhD, PG (Timberline’s qualified person) and RESPEC Company LLC of Reno, Nevada

~~Timberline~~Complete ~~does~~descriptions, ~~not~~data ~~have~~and ~~permits~~analysis ~~to operate a mine. The Company operates exploration activities at Lookout Mountain under a Plan~~ of ~~Operations (PoO) approved in 2010 by~~ the ~~Bureau~~Company’s ofmineral ~~Land Management (BLM)~~interests, ~~subject~~together towith ~~annual~~graphs, ~~workplan~~tables ~~amendments for drilling related disturbance. Additional environmental~~ and ~~engineering~~diagrams, ~~studies~~can ~~will~~ be ~~required~~viewed toin ~~support~~our afiscal ~~mine~~2023 ~~plan~~annual ofreport ~~operations~~dated ~~with~~December ~~the~~31, ~~BLM~~2023, toas ~~comply with the National Environmental Policy Act (NEPA)~~amended, ~~and~~originally tofiled ~~meet~~with ~~State~~the ofSecurities ~~Nevada Bureau of Mine Regulation~~ and ~~Reclamation~~Exchange ~~and~~Commission ~~other~~on ~~agency~~January ~~permit~~2, ~~requirements~~2024.

~~(Explanatory~~Detailed ~~Note:~~maps ~~The original filing for Form 10-K on December 29, 2022 disclosed Measured & Indicated resources of 508,000 ounces~~ and ~~Inferred~~mineral resources ~~of 141,000 ounces, The table above reflects a reduction of those~~ estimates offor ~~85,000~~the ~~ounces~~Eureka ~~and 57~~Project,~~000~~ ~~ounces, respectively, as a result of~~ the ~~application~~2023 ofTechnical ~~the~~Report ~~‘pit-constrained’~~Summary ~~methods~~and asother ~~disclosed~~technical inreports ~~the~~and ~~notes~~information toon the ~~table~~Company’s ~~above.~~projects ~~The~~may ~~application~~be ofviewed ~~this constraint appropriately takes into account a measure of economic viability of mining the resources~~at http://timberlineresources.)co.

13Summary ~~Table~~ of ~~Contents~~the exploration activities for the three months ended December 31, 2023:

~~Qualified~~During ~~Person~~the three months ended December 31, 2023, Management’s ~~Conclusions~~efforts ~~and~~were ~~Recommendations~~directed toward securing additional financing to advance the mineral rights owned by the Company, in which it was successful in the short term. Additional funds will be required to perform planned exploration programs on ~~Lookout~~the ~~Mountain~~Company’s properties, but the funds required to support the administration and operating activities of the Company in the interim period until long-term financing can be obtained, were secured with a cash infusion of $630,000 to the Company as a result of selling common shares and warrants in a private placement transaction.

~~RESPEC~~4 ~~has~~Table ~~reviewed the project data and has visited the site. RESPEC and Timberline’s non-independent QP, Dr. Steven Osterberg, believe the data reviewed is an accurate and reasonable representation~~ of ~~the Lookout Mountain project.~~Contents

~~The~~Exploration ~~resources~~Plans ~~reported~~and above are open along strike in both directions, as well as down dip. The possible extension of the Lookout Mountain deposit south through to the South Adit resource, located approximately 3,500 feet south of the southern limit of the modeled mineralization at Lookout Mountain, provides the best opportunity for near-term enhancement of project resources. In addition, there is excellent potential to add to the existing resources that lie west of the Ratto Canyon fault at the Lookout Mountain deposit.Budgets

~~Ongoing~~Our ~~Exploration~~exploration ~~Work~~focus atduring fiscal 2024 will continue to be on the Eureka Project. Our financial and human resources will be dedicated to the advancement of the Lookout Mountain, Water Well, New York Canyon, and other targets across the property. The results of our drilling, mapping, geochemical and geophysical work completed during fiscal years 2020 through 2022 exploration seasons significantly advanced our understanding of the overall geologic setting of the Eureka Project, highlighting several areas with potential for significant gold mineralization. Our most significant advances during this period were the strong drill results announced in FY 2022, the acquisition of patented claims in New York Canyon, surface sampling results for silver and gold in New York Canyon, and the growing potential of carbonate replacement silver-lead-zinc deposits (CRD) on the Eureka Project and more broadly in the district. During fiscal year 2023, management conducted extensive analysis of historical data, newer geophysical and geological data, and district geology to advance integrated targets for CRD silver-lead-zinc and Carlin-type gold exploration. This work will serve as a guide for our fiscal 2024 exploration plan.

~~Since~~Execution ~~2013~~of ~~Timberline~~any ~~has~~2024 ~~focused its~~ exploration ~~work~~activities ~~outside~~will ~~the~~be ~~Lookout~~contingent ~~Mountain~~upon ~~resource~~our inability ~~other~~to ~~parts~~secure ofadditional ~~the~~financing ~~Eureka~~prior ~~Property.~~to ~~However,~~ the exploration ~~Plan~~season. ofOur ~~Operations~~preliminary ~~includes~~exploration ~~provisions~~budget for ~~drilling~~fiscal ~~and~~2024 ~~other~~is ~~exploration~~expected ~~activity~~to ~~within~~exceed ~~the~~$3.0 ~~resource~~million, ~~area~~funded ~~and~~largely ~~beyond~~by itadditional ~~into~~financing ~~other~~activities ~~target~~as ~~areas~~we ~~such~~enter asinto the ~~Water~~new ~~Well~~2024 ~~Zone,~~calendar ~~Rocky~~year. ~~Canyon,~~Details ~~and~~of the ~~Graben~~exploration ~~Zone.~~plan ~~While~~for ~~these~~fiscal ~~targets~~2024 ~~are~~will ~~not~~follow ~~addressed~~anticipated infinancing ~~the~~successes, ~~S-K~~which ~~1300~~will ~~Technical~~determine ~~Report as part of~~ the ~~Lookout~~nature ~~Mountain Project, they~~ and ~~other~~extent ~~targets are part~~ of ~~the~~an ~~larger~~exploration ~~Eureka Property~~program.

ToResults ~~support additional exploration at Lookout Mountain, the Company’s environmental consultant advanced an update~~ of ~~the exploration Plan of~~ Operations ~~by expanding the site Cultural Resources Survey. Field work~~ for the ~~survey~~three ~~was~~months ~~completed~~ended inDecember ~~2022~~31, ~~with follow-up analysis continuing through the second quarter of calendar year~~ 2023. ~~The contractor submitted a final report to the BLM in July 2023. As with earlier reviews, multiple cultural avoidance areas are identified~~ and will require additional site screening and potential mitigation prior to completion of field work such as drilling activities. Management does not consider the avoidance areas to be a significant impediment to planned exploration activities as they are typically small areas around which drill sites and access roads can be positioned. 2022

New Exploration Targeting for Carlin-type Gold and Carbonate Replacement Deposits:

Timberline’s primary exploration efforts to-date have focused on the discovery of Carlin-type gold deposits such as that at Lookout Mountain and the historical Windfall Mine. Through evaluation of district data, our geologists also recognize potential for the discovery of silver-lead-zinc and gold deposits of the CRD type. Timberline has advanced some of these targets during Q3 of FY 2023.

Ongoing analysis of district exploration data has defined three primary target areas (New York Canyon, Windfall, and Lookout-Oswego areas) for discovery of CRD silver-lead-zinc deposits at Eureka (identified in blue in Figure 1). The following is a discussion of recent work on these targets.

New York Canyon Target

During Q3/FY2023, the Company completed an acquisition of additional fractional interest in 3 of 9 patented claims previously acquired at New York Canyon. As patented claims, drilling is permissible with minimal permit requirements. The drilling will initially target highly de-calcified and/or silicified rocks of the Ordovician Hanson Creek formation, which carry high-grade gold and silver (Figure 2). Selected rock samples were reported in a Company news release dated February 2, 2023 and are highlighted in the figure. These included samples containing gold values of 55, 32, 23.3, 22.5, and 14.95 g/t and silver values of 750, 582.5, 558, 555, and 299 g/t.

Mapping and sampling at New York Canyon have confirmed the presence of important northwest trending structures that seem to control high-grade rock sampling and much of the historical mining in the area. Company geologists see the potential for the development of more mineralization along these structures, both in the near surface and to greater depth. There is also a major north-northeast striking fault through New York Canyon that may be important in focusing mineralization. The Ordovician Pogonip group of rocks (shaded light blue on Figure 2) is dipping east beneath the area of anomalous rock samples. The Pogonip includes potentially important host rocks that may constitute strong silver-gold targets at depth.

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Figure 1. Location of Lookout Mountain Gold Resource and CRD Exploration Target Areas.

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Figure 2. New York Canyon Geology and Ag-Au Rock Geochemistry.

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Figure 3. 3-D Perspective of the Windfall area Exploration Target Areas, Structures, and IP Anomaly Trends.

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Windfall-area Targets: Hoosac, Windfall Mine trend, and Prospect Mountain

Rock sampling and historical drilling from the vicinity of the Rustler, Windfall, and Paroni pits clearly indicate remaining potential for Carlin-type gold along the Windfall trend. Figure 3 includes selected rock samples and drill intercepts from the Timberline database. Sampling from 2022 returned numerous samples with more than 1.0 g/t gold, including one sample that assayed 43g/t gold.

Anomalous CRD-type silver-gold occurs in the Windfall area east-southeast of the historical Rustler open pit gold mine (Figure 3). Silver and gold mineralization, including rock samples of 271 g/t Ag and 2.1 g/t Au, occurs along several hundred meters of strike of a structural corridor that parallels the Windfall trend. The Hoosac Trend exhibits intense alteration (silicification) and induced polarization (IP) chargeability anomalies, locally with elevated base metals (6.1% lead). The historical Old Hoosac Mine occurs in this area. Historical samples from mine waste dumps identified gold up to 1.6 g/t and silver up to 96 g/t. Drilling to-date has not significantly tested this structural corridor or the related geophysical anomalies, identified in Figure 3 as the Hosac Trend.

A second linear IP Anomaly occurs west of the Windfall Trend along the east slope of Prospect Mountain (Figure 3). The strong anomaly is hosted within the Cambrian-aged Eldorado Dolomite adjacent to the Jackson Fault. Little is known about this target yet, except that it occurs in a favorable geologic setting for CRD mineralization – analogous to historical mines such as the Diamond Mine and Fad Shaft to the north and the Burning Moscow to the south (Figure 1). There is considerable exploration work occurring along the apparent northern continuation of this feature (North Peak Resources at the historical Prospect Peak Mine Complex and i80 Gold Corp. at the Hilltop and Blackjack targets at the Ruby Hill Mine).

Oswego Area:

Timberline has previously reported significant high-grade gold from the Oswego target, approximately 1.5 kilometers east of Lookout Mountain. A Company news release dated December 6, 2021 detailed the results of rock chip and channel sampling along a fault scarp of the Dugout Tunnel Fault at Oswego, which included 25.9m @ 14.4 g/t Au and 27.4m @ 12.0 g/t Au. The same channel samples included significant silver, 25.9m @ 24.2 g/t Ag and 27.4m @ 8.5 g/t Ag. While occurring in a fault zone, this gold and silver occurrence is hosted in the Eldorado Dolomite, one of the most important hosts of CRD mineralization in the district (Figure 4).

The multielement geochemistry on this target is complex, including typical Carlin-type gold indicators (gold, arsenic, and antimony) and elements usually associated with CRD deposits (silver, lead, zinc, antimony, and bismuth). As reported elsewhere in the Eureka District, this could be the result of overlapping CRD silver-gold and Carlin-type gold. The nearby historical Oswego and Geddes-Bertrand Mines demonstrate even higher silver values (as high as 2,000 g/t) with strong peak values in lead (7.5%) and zinc (23.3%), including associated arsenic and antimony. There is insufficient drilling in this area to assess the potential for either Carlin-type gold or CRD silver-gold, and historical drilling in the area was very shallow (typically less than 500 ft).

Lookout Mountain Area:

Timberline geologists continue their assessment of the Lookout Mountain part of the district in the context of the Water Well Zone gold results and deeper results from the Graben Zone reported in 2022 i80 Gold Corp also continues to release significant gold and silver results from their ongoing exploration at the Ruby Hill Mine and its numerous exploration targets. These results indicate the presence of multiple types of mineral deposits, including Carin-type gold, CRD-type silver-lead-zinc, and possibly skarn or epithermal gold-silver deposits. The various historical deposits, current resources, and exploration targets at Ruby Hill are hosted in sedimentary rocks of Cambrian and Ordovician age, as well as intrusive rocks of likely Cretaceous age. Lookout Mountain and Water Well Zone are host to significant gold mineralization a similar section of Cambrian rocks, but nearby silver mineralization drilled by Timberline may be hosted in younger Ordovician rocks, and potentially in intrusive rocks of unknown age (Company news release dated March 24, 2022).

Three Timberline drill holes in 2021 and 2022 drilled peripheral to the strong IP anomaly intersected likely CRD-related mineralization associated with granitic dikes and intensely altered contact-metamorphosed sedimentary rocks. The silver intercepts included:

· 203m @ 5.3 g/t Ag, including 56.9m @ 12.2 g/t; · 35m @ 10.1 g/t Ag; and · 79.2 m @ 8.2 g/t Ag and and 30.5 m @ 12.2 g/t Ag.

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Figure 4. Lookout Mountain and Oswego Surface Rock Au and Ag geochemistry, and Drillhole Silver.

A strong IP chargeability anomaly (Figure 4) extends 1.3 km north-south and on-trend with similar anomalies to both north and south. The geophysical anomalies seem to be aligned with deep throughgoing high-angle faults. While the geophysical target has only been peripherally tested, the occurrence of Carlin-type gold and CRD type silver intercepts in this area with granitic dikes and hornfelsed and altered carbonate rocks compares favorably with the more advanced polymetallic discoveries being made at the Ruby Hill Mine in the northern part of the district.

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A key ingredient in the large and growing metal endowment in the northern part of the district seems to be the large-scale igneous complex in the area (Graveyard Flats, Ruby Hill, and Mineral Point intrusives). Timberline geologists are working to assess the intrusive rocks already encountered in the Lookout Mountain area, including conducting age dating. A preliminary interpretation of historical magnetic data suggests that the Lookout Mountain area is underlain by a significant intrusive phase that may be similar to the Graveyard Flats intrusion at Ruby Hill. Much more work is needed to address this question, but early drill testing in the area has already encountered granitic dikes with associated silver at less than 1,000 feet depth. In addition to the various Carlin-type gold targets in the Lookout Mountain area, Timberline expects to develop CRD-type targets for drilling at the earliest opportunity.

Non-Material Properties:

We also control multiple projects that are not material to the Company at this time, pending further exploration activities, including:

· The multiple targets of the Eureka Property apart from the Lookout Mountain project, such as the Windfall Trend, Water Well Zone, Rocky Canyon, Oswego New York Canyon, and others, are actively being explored but have not yet advanced to a point of materiality for the Company. · The Paiute Project, held jointly with Nevada Gold Mines, is in the Battle Mountain District at the northern end of the Battle Mountain-Eureka Trend. There was no significant work conducted at Paiute during the quarter. · The Seven Troughs Project in northwestern Nevada is a historical high-grade epithermal vein district. We conducted no significant work at Seven Troughs during the quarter.

Results of Operations for the three and nine months ended June 30, 2023 and 2022

Consolidated Results

(US$)

Three Months ~~Ended~~EndedDecember ~~June 30~~31,

~~Nine Months Ended June 30,~~

2023

2022

~~2023~~

~~2022~~

Exploration expenses:

Eureka

4619,~~478~~919

~~808~~442,~~519~~037

~~533,449~~

~~2,462,543~~

Other exploration properties

6239,~~283~~328

8780,~~946~~606

~~194,378~~

~~234,254~~

Total exploration expenditures

~~108~~59,~~761~~247

~~896~~522,~~465~~643

~~727,827~~

~~2,696,797~~

Non-cash expenses:

Stock option expenses

113,~~084~~669

-51,708

~~73,879~~

~~44,321~~

Depreciation, amortization and accretion

1,~~715~~800

1,~~478~~715

~~5,145~~

~~4,434~~

Total non-cash expenses

125,~~799~~469

153,~~478~~423

~~79,024~~

~~48,755~~

Professional fees expenses

5859,~~393~~462

6162,~~234~~859

~~171,904~~

~~155,938~~

Insurance expenses

4013,~~821~~967

4344,~~204~~528

~~125,739~~

~~116,651~~

Salaries and benefits expenses

7774,~~279~~021

7160,~~819~~456

~~204,961~~

~~219,750~~

Interest and other (income) expense

~~16,726~~408

~~228~~11,~~479~~447

~~42,117~~

~~251,505~~

Other general and administrative expenses

7819,~~762~~713

~~148~~126,~~270~~187

~~308,011~~

~~283,499~~

Net loss

~~393~~232,~~541~~287

1881,~~450,949~~543

~~1,659,583~~

~~3,772,895~~

Our consolidated net loss for the three months ended ~~June~~December 3031, ~~2022~~2023 was $~~393~~232,~~541~~287, compared to a consolidated net loss of $1881,~~450,949~~543 for the three months ended ~~June~~December 3031, 2022. ~~Total exploration expenses of $108,761 were recorded on our statement of operations for the three months ended June 30, 2023, compared with $896,465 for the three months ended June 30, 2022.~~ The ~~year-over-year~~ decrease in net loss is ~~mainly~~largely due to athe significant decrease in exploration ~~expense~~expenses, ~~combined~~stock ~~with~~option ~~slight~~expenses ~~decreases~~and inother ~~professional~~general ~~fees~~and ~~expense,~~administrative ~~insurance~~expenses ~~expense,~~as ~~interest~~a ~~and~~result ~~other~~of ~~(income)~~our ~~expense,~~intentional ~~and~~scale-back ~~other~~of ~~general~~operating ~~and~~activities ~~administrative expense~~ during ~~the~~management’s ~~three~~efforts ~~months~~to ~~ended~~raise ~~June~~funds ~~30,~~for ~~2023~~operations.

20Subject ~~Table~~to adequate funding in 2024, we expect to continue to incur exploration expenses for the advancement of ~~Contents~~our Eureka Project.

Our consolidated net loss for the nine months ended June 30, 2023 was $1,659,583, compared to a consolidated net loss of $3,772,895 for the nine months ended June 30, 2022. Total exploration expenses of $727,827 were recorded on our statement of operations for the nine months ended June 30, 2023, compared with $2,696,727 for the nine months ended June 30, 2022. The year-over-year decrease in net loss is due to the significant decrease in exploration expenses and other (income) expense.

Subject to adequate funding in 2023, we expect to continue to incur exploration expenses for the advancement of our Eureka Project.

Financial Condition and Liquidity

At ~~June~~December 3031, 2023, we had assets of $1415,~~866~~260,~~883~~543, consisting of cash in the amount of $~~172~~541,~~416,~~493; property, mineral rights and equipment of $14,~~127~~173,178, net of depreciation, reclamation bonds of $528,643, and prepaid expenses, deposits and other assets in the amount of $3817,~~646~~229.

On ~~June~~December 3031, 2023, we had total liabilities of $~~637~~421,~~825~~381 and total assets of $1415,~~866~~260,~~883~~543. This compares to total liabilities of $1358,~~157,467~~095 and total assets of $1614,~~972~~795,~~229~~875 on September 30, ~~2022~~2023. As of ~~June~~December 3031, 2023, our liabilities consist of $~~142~~145,~~325~~840 for asset retirement obligations, ~~$270,991 of senior unsecured note payable – related party,~~ and $~~119~~275,~~511~~541 of trade payables and accrued liabilities ~~and $104,998 of interest and expenses payable to related parties~~. Of these liabilities, $~~495~~275,~~500~~541 are due within twelve months. The liabilities compared to September 30, ~~2022~~2023 have ~~changed~~increased, asdue ato ~~result~~increased ~~of a decrease in~~ trade payables, ~~and~~ accrued ~~liabilities~~payroll, ~~offset~~benefits byand ~~increases~~taxes, inand accrued ~~interest~~liabilities -during ~~related party. The decrease in total assets was due to~~ the ~~usage~~three ofmonths ~~cash~~ended toDecember ~~reduce accounts payable and to pay Company operating expenses~~31, ~~offset by an increase in property, mineral rights, and equipment~~2023.

On5 ~~June~~Table ~~30, 2023, we had negative working capital~~ of $290,138 and stockholders’ equity of $14,229,058 compared to working capital of $1,423,723 and stockholders’ equity of $15,814,762 for the year ended September 30, 2022. Working capital experienced an unfavorable change because of the decrease in cash associated with payments of accounts payable and operating expenses, offset by increases in accrued interest - related party.Contents

~~During~~On ~~the~~December ~~nine months ended June 30~~31, 2023, we ~~used~~had ~~cash~~working ~~from~~capital ~~operating activities~~ of $2281,~~132,869,~~981 ~~compared~~and tostockholders’ ~~cash~~equity ~~used~~ of $314,~~686~~839,~~561~~162 ~~for~~compared ~~the~~to ~~nine~~negative ~~months~~working ~~ended~~capital ~~June~~of 30$107,701 ~~2022.~~and ~~The~~stockholders’ ~~use~~equity of ~~cash from operating activities results primarily from the net loss of~~ $114,~~659~~437,~~583~~780 for the ~~nine-month~~year ~~period~~ ended ~~June~~September 30, 2023. ~~compared~~Working tocapital ~~net~~experienced ~~loss~~a offavorable ~~$3,772,895~~change ~~for~~due to the ~~nine~~increase ~~months~~in ~~ended~~available ~~June~~cash ~~30,~~from ~~2022.~~a ~~Changes~~completed toprivate ~~the~~placement ~~net~~financing ~~loss~~during ~~for~~ the ~~comparative~~three ~~periods~~months ~~are~~ended ~~described~~December ~~above~~31, 2023.

During the ~~nine-month~~three ~~period~~months ended ~~June~~December 3031, 2023, ~~cash~~we ofused ~~$133,302~~cash ~~was~~from ~~used~~operating byactivities ~~investment~~of ~~activities~~$168,731, compared ~~with~~to cash used of $431,~~947~~453,507 ~~used by investment activities~~ for the ~~nine-month~~three ~~period~~months ended ~~June~~December 3031, 2022. ~~During~~The ~~the~~use ~~nine~~of ~~months~~cash ~~ended~~from ~~June~~operating ~~30,~~activities ~~2023,~~results weprimarily ~~used~~from the net loss of $~~133~~232,~~302~~287 for ~~mineral~~the ~~rights~~three-month period ended December 31, 2023 compared to net loss of $54881,~~000~~543 ~~paid~~ for ~~mineral~~the ~~rights~~quarter ~~and~~ended ~~received~~December a31, ~~reclamation~~2023. ~~bond~~Changes ~~refund~~to ofthe ~~$10,053~~net loss for the ~~nine~~comparative ~~months~~periods ~~ended~~are ~~June~~described ~~30, 2022~~above.

During the ~~nine~~three-month period ended ~~June~~December 3031, 2023, nocash ~~financing~~of ~~activities~~$18,000 ~~occurred~~was used by investment activities, compared towith cash of $428,~~586,086~~933 ~~provided~~used ~~during~~for the ~~nine~~three-month period ended ~~June~~December 3031, 2022. During the quarter ended December 31, 2023, we paid $18,000 for mineral rights, compared to $28,933 paid for mineral rights for the quarter ended December 31, 2022.

During the three-month period ended December 31, 2023, cash of $630,000 was provided by financing activities compared to $nil for the quarter ended December 31, 2022.

Going Concern:

The audit opinion and notes that accompany our consolidated financial statements for the year ended September 30, ~~2022~~2023 disclose a ‘going concern’ qualification to our ability to continue in business. These consolidated financial statements have been prepared on the basis that the Company is a going concern, which contemplates the realization of our assets and the settlement of our liabilities in the normal course of our operations. Disruptions in the credit and financial markets over the past several years have had a material adverse impact on a number of financial institutions and investors and have limited access to capital and credit for many companies. In addition, commodity prices and mining equities have seen significant volatility which increases the risk to precious metal investors. Market disruptions and alternative investment options, among other things, make it more difficult for us to obtain, or increase our cost of obtaining, capital and financing for our operations. Our access to additional capital may not be available on terms acceptable to us or at all. If we are unable to obtain financing through equity investments, we will seek multiple solutions including, but not limited to, asset sales, corporate transactions, credit facilities or debenture issuances in order to continue as a going concern.

At ~~June~~December 3031, 2023, we had ~~negative~~ working capital of $~~290~~281,~~138~~981. We had $~~495~~275,~~500~~541 outstanding in current liabilities and a cash balance of $~~172~~541,~~416~~493. As of the date of this report on Form 10-Q, we do not have sufficient cash to meet our normal operating commitments for the next 12 months, without ~~raising~~ additional ~~funds~~financing. ~~Such~~Therefore, we expect to be required to engage in financial transactions to increase our cash~~-raising~~ ~~efforts~~balance ~~may~~or ~~include~~decrease ~~equity~~our ~~financings~~cash obligations in the near term. However, ~~corporate~~we ~~transactions~~are an exploration company with exploration programs that require significant cash expenditures. A significant drilling program, ~~joint~~such ~~venture~~as ~~agreements~~that we have executed in prior years, ~~sales~~can result in depletion of ~~assets,~~cash ~~credit~~and ~~facilities~~would orbe ~~debenture~~prohibitive ~~issuances,~~unless orwe ~~other~~can ~~strategic~~secure ~~transactions~~sufficient cash to support normal operations for the following 12 months.

21 Table of Contents

The condensed consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern. We believe that the going concern condition cannot be removed with confidence until the Company has entered into a business climate where funding of its activities is more assured. If the going concern basis were not appropriate for these financial statements, adjustments would be necessary in the carrying value of assets and liabilities, the reported expenses and the balance sheet classifications used.

We plan, as funding allows, to follow up on our positive drill results on our Eureka ~~and Paiute Projects~~Project. ~~Principally,~~Subject ~~we plan~~ to ~~execute drilling as part of the ongoing exploration program at Eureka. Also, subject to~~ available capital, we may continue prudent exploration programs on our material exploration properties and/or fund some exploratory activities on early-stage properties.

We will require additional funding and/or reductions in exploration and administrative expenditures in future periods. Given current economic conditions, we cannot provide assurance that necessary financing transactions will be available on terms acceptable to us, or at all. Without additional financing, we would have to curtail our exploration and other expenditures while we seek alternative funding arrangements to provide sufficient capital to meet our ongoing, non-discretionary expenditures, and maintain our primary mineral properties. If we cannot obtain sufficient additional financing, we may be unable to make required property payments on a timely basis and be forced to return some or all of our leased or optioned properties to the underlying owners.

Table of Contents

Financing Activities

~~None~~On December 28, 2023, we closed a non-brokered private placement to accredited investors at a price of $0.04 per unit. Units consist of one share of common stock and one series P warrant share. We issued 15,750,000 common shares and a like number of warrants for cash proceeds of $630,000. The warrants have a term of four years and are exercisable at $0.06 per common share.

Subsequent Events

None.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, results of operations, liquidity or capital expenditures.

Critical Accounting Policies and Estimates

There have been no significant changes to the critical accounting policies and estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operation in our ~~2022~~2023 Form ~~10K~~10-K/A.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

Conclusions of Management Regarding Effectiveness of Disclosure Controls and Procedures

OnAt ~~July~~the ~~12,~~end ~~2023,~~of wethe ~~filed~~period ~~Amendment~~covered ~~No.~~by 1this toQuarterly ~~Timberline Resources Corporation’s Annual~~ Report on Form 10-KQ, ~~for~~an ~~the~~evaluation ~~fiscal~~was ~~year~~carried ~~ended~~out ~~September~~under ~~30,~~the ~~2022,~~supervision toof ~~incorporate~~and ~~additional~~with ~~information~~the ~~concerning~~participation ~~Timberline’s~~of ~~properties~~our management, including ~~revisions~~the ~~made~~Principal inExecutive ~~the~~Officer ~~report~~and ~~entitled~~the ~~“S-K~~Principal ~~1300~~Financial ~~Technical~~Officer ~~Report~~of ~~Summary:~~the ~~Lookout~~effectiveness ~~Mountain~~of ~~Project,~~the ~~Eureka~~design ~~Property,~~and ~~Eureka,~~operations ~~Nevada”~~of ~~which~~our ~~has~~disclosure acontrols ~~revised~~ and ~~amended~~procedures ~~date~~(as ofdefined ~~June~~in ~~21,~~Rule ~~2023~~13a ~~and~~– an15(e) ~~effective~~and ~~date~~Rule of15d ~~December~~– ~~31,~~15(e) ~~2022.~~under ~~The~~the ~~enhanced~~Exchange ~~disclosures~~Act) as of ~~this~~the ~~Form~~end ~~10-K/A~~of ~~were~~the ~~made~~period tocovered ~~comply~~by ~~with~~this ~~guidance~~report. ~~provided~~Based byupon ~~Regulation~~that ~~S-K~~evaluation, ~~Subpart~~it ~~1300.~~was ~~The~~concluded ~~Form~~that ~~10-K/A~~our ~~disclosed ineffective~~ disclosure controls ~~and~~were ~~procedures~~effective ~~for~~as of the end of the period ~~ended~~covered ~~September~~by ~~30,~~this ~~2022~~report, ~~due~~ to ~~amendments~~ensure wethat: ~~made~~(i) ininformation ~~that~~required ~~Form~~to ~~10-K/A~~be ~~concerning~~disclosed ~~disclosures~~by ofthe ~~variables~~Company ~~and~~in ~~computations~~the ofreports ~~mineral~~that ~~resources,~~it asfiles ~~required~~under bythe ~~Subpart~~Exchange ~~1300~~Act ofis ~~Regulation~~recorded, ~~S-K~~processed, ~~which~~summarized, ~~had~~and ~~been~~reported ~~amended~~within inrequired atime ~~prior~~periods ~~year.~~specified ~~During~~by the ~~quarter~~Securities ~~ended~~& ~~June~~Exchange ~~30,~~Commission ~~2023~~rules and forms, weand ~~engaged~~(ii) ~~qualifying~~material ~~professionals~~information required to ~~re-issue~~be ~~our~~disclosed ~~technical~~in ~~report~~reports onfiled under the ~~Lookout~~Exchange ~~Mountain~~Act ~~project~~is accumulated and ~~included~~communicated ~~the~~to ~~required~~our ~~information~~management, inincluding ~~the~~our ~~Form~~Chief ~~10-K/A~~Executive ~~filed~~Officer onand ~~July~~Chief 12Accounting Officer, ~~2023~~as appropriate, to allow for accurate and timely decision regarding required disclosure.

At the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was carried out under the supervision of and with the participation of our management, including the Principal Executive Officer and the Principal Financial Officer of the effectiveness of the design and operations of our disclosure controls and procedures (as defined in Rule 13a – 15(e) and Rule 15d – 15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, it was concluded that our disclosure controls were effective as of the end of the period covered by this report, to ensure that: (i) information required to be disclosed by the Company in the reports that it files under the Exchange Act is recorded, processed, summarized, and reported within required time periods specified by the Securities & Exchange Commission rules and forms, and (ii) material information required to be disclosed in reports filed under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Accounting Officer, as appropriate, to allow for accurate and timely decisions regarding required disclosure.

22 Table of Contents

Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. This internal control system has been designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair statement of the Company’s published financial statements.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Our management has assessed the effectiveness of the Company’s internal control over financial reporting as of ~~June~~December 3031, 2023. To make this assessment, we used the criteria for effective internal control over financial reporting described in Internal Control-Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our assessment, we believe that, as of ~~June~~December 3031, 2023, the Company’s internal ~~controls~~control over financial reporting ~~are~~is effective.

Management’s Remediation Initiatives

Management’s remediation initiatives included implementing additional segregation of duties over cash management, specifically in bank account reviews and reconciliations. An additional person, independent of the processing of processing of vendor invoices and payments has been engaged and assigned to perform the reviews and reconciliations of bank accounts on a monthly basis. Those responsibilities were initiated during the quarter ended March 31, 2023 and were fully in place and operation for the quarter ended June 30, 2023. The Company has three employees, and management has concluded that anticipated business growth and the accompanying expansion of staffing will improve effectiveness of the Company’s internal controls over financial reporting.

Changes in Internal Control over Financial Reporting

~~The~~There ~~Company~~was ~~made~~ no ~~changes~~material change in internal ~~controls~~control over financial reporting in the quarter ended ~~June~~December 3031, 2023.

237 Table of Contents

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We are not aware of any material pending litigation or of any proceedings known to be contemplated by governmental authorities which are, or would be, likely to have a material adverse effect upon us or our operations, taken as a whole. No director, officer or affiliate of Timberline and no owner of record or beneficial owner of more than 5% of our securities or any associate of any such director, officer or security holder is a party adverse to Timberline or has a material interest adverse to Timberline in reference to any currently pending litigation.

ITEM 1A. RISK FACTORS

There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K/A for the year ended September 30, ~~2022~~2023, which was filed with the SEC on ~~July~~ 12January 17, ~~2023~~2024.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

~~There~~On ~~were~~December no28, ~~sales~~2023, we closed a non-brokered private placement to accredited investors at a price of ~~unregistered~~$0.04 ~~equity~~per ~~securities~~unit. ~~during~~Units ~~the~~consist ~~fiscal~~of ~~quarter~~one ~~covered~~share byof ~~this~~common ~~Quarterly~~stock ~~Report~~and onone ~~Form~~series ~~10-Q~~P warrant share. We issued 15,750,000 common shares and a like number of warrants for cash proceeds of $630,000. The warrants have a term of four years and are exercisable at $0.06 per common share.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES

We consider health, safety and environmental stewardship to be a core value for the Company.

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities with respect to mining operations and properties in the United States that are subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). During the quarter ended ~~June~~December 3031, 2023, our U.S. exploration properties were not subject to regulation by the MSHA under the Mine Act.

ITEM 5. OTHER INFORMATION

None.

248 Table of Contents

ITEM 6. EXHIBITS.

3.1	Certificate of Incorporation of the Registrant as amended through October 31, 2014, incorporated by reference to the Company’s Form 10-K as filed with the Securities and Exchange Commission on December 23, 2014	Certificate of Incorporation of the Registrant as amended through October 31, 2014, incorporated by reference to the Company’s Form 10-K as filed with the Securities and Exchange Commission on December 23, 2014
3.2	~~Amended By-Laws of the Registrant, incorporated by reference to the Company’s Form 8-K as filed with the Securities and Exchange Commission on August 13, 2015.~~	Amended By-Laws of the Registrant, incorporated by reference to the Company’s Form 8-K as filed with the Securities and Exchange Commission on August 13, 2015.
4.1	~~Specimen of the Common Stock Certificate, incorporated by reference to the Company’s Form 10SB as filed with the Securities Exchange Commission on September 29, 2005~~	Specimen of the Common Stock Certificate, incorporated by reference to the Company’s Form 10SB as filed with the Securities Exchange Commission on September 29, 2005
4.2	Form of Warrant Agreement incorporated by reference to the Company’s Form 10-Q filed with the Securities and Exchange Commission on August 11, 2016.
4.2*		Form of the Series M Warrant, filed herewith
4.3	Form of Warrant Agreement for March and April 2017 Offering of Units, incorporated by reference to the Company’s Form 10-Q filed with the Securities and Exchange Commission on May 15, 2017.
4.3*		Form of the Series N Warrant, filed herewith
4.4	Form of the Series H Warrant, incorporated by reference to exhibit 99.1 to the Company’s Form 8-K as filed with the Securities and Exchange Commission on April 1, 2019
4.4*		Form of the Series P Warrant, filed herewith
4.5	Form of the Series G Warrant, incorporated by reference to exhibit 4.4 to the Company’s Form 10-Q as filed with the Securities and Exchange Commission on August 14, 2019
31.1*		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rules 13a-14 and 15d-14 of the Exchange Act)
4.6	Form of the Series I Warrant, incorporated by reference to exhibit 4.8 to the Company’s Form 10-K as filed with the Securities and Exchange Commission on Jan 10, 2020
31.2*		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rules 13a-14 and 15d-14 of the Exchange Act)
4.7	Form of the Series J Warrant, incorporated by reference to exhibit 4.5 to the Company’s Form 8-K as filed with the Securities and Exchange Commission on October 25, 2019
32.1*		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)
4.8	Form of the Series K Warrant, incorporated by reference to exhibit 4.8 to the Company’s Form 10-K as filed with the Securities and Exchange Commission on January 13, 2021
32.2*		Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)
4.9	Form of the Series L Warrant, incorporated by reference to exhibit 4.1 to the Company’s Form 8-K as filed with the Securities and Exchange Commission on September 1, 2020
101.INS*		XBRL Instance Document
10.1	Technical report entitled S-K 1300 Technical Report Summary: Lookout Mountain Project, Eureka Property, Eureka, Nevada dated June 21, 2023 with an effective date of December 31, 2022, incorporated by reference to exhibit 10.15 to the Company’s Form 10-K/A as filed with the Securities and Exchange Commission on July 12, 2023.
101.SCH*		XBRL Taxonomy Extension Schema Document
10.2	Management Summary of SK 1300 Report, incorporated by reference to exhibit 10.16 to the Company’s Form 10-K/A as filed with the Securities and Exchange Commission on July 12, 2023.
101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document
10.3	Consent of Qualified Person for RESPEC, incorporated by reference to exhibit 10.17 to the Company’s Form 10-K/A as filed with the Securities and Exchange Commission on July 12, 2023.
101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document
10.4	Consent of Qualified Person for Steven A. Osterberg, incorporated by reference to exhibit 10.18 to the Company’s Form 10-K/A as filed with the Securities and Exchange Commission on July 12, 2023.
101.LAB*		XBRL Taxonomy Extension Label Linkbase Document
31.1*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rules 13a-14 and 15d-14 of the Exchange Act)
101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document
31.2*	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rules 13a-14 and 15d-14 of the Exchange Act)
32.1*	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)
32.2*	Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

* - Filed herewith

259 Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TIMBERLINE RESOURCES CORPORATION
	By:	/s/ Patrick Highsmith
		Patrick HighsmithPresident and Chief Executive Officer(Principal Executive Officer)
		Patrick Highsmith
	Date:	August 11, 2023
		President and Chief Executive Officer
		(Principal Executive Officer)
	Date: February 13, 2023
	By:	/s/ Ted R. Sharp
		Ted R. SharpChief Financial Officer(Principal Financial and Accounting Officer)
		Ted R. Sharp
	Date:	August 11, 2023
		Chief Financial Officer
		(Principal Financial and Accounting Officer)
	Date: February 13, 2023

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