Timberline extends Small Mine Development note's maturity to 2012

By Devika Patel

Knoxville, Tenn., June 23 - Timberline Resources Corp. said it extended the maturity of its $5 million convertible note with Small Mine Development, LLC to April 30, 2012.

"We are happy to obtain this long-term extension of this loan, which was possible due to our close affiliation and working relationship with SMD," Timberline's chief executive officer Randal Hardy said in a press release.

"The due date is now extended to a time when we expect to be producing gold and generating cash flow from our Butte Highlands Gold Project, where we continue to work closely with SMD as our partner and the operator."

The note remains convertible at any time at a conversion price of $1.50 per share, and the note may be prepaid at any time without penalty. The other terms of the note remain unchanged, with the exception of the monthly interest, which is now payable in cash.

As consideration for extending the loan, Timberline paid Small Mine Development all of the accrued interest through June 30 in cash along with a 1% loan extension fee.

Timberline is a mineral exploration company based in Coeur d'Alene, Idaho.

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