Mr. Dino Cremonese reports

UPDATE ON LITIGATION/LEDUC SILVER-CASTLE AGREEMENT

A hearing in front of the registrar was held yesterday, March 31, 2015, to determine the quantum of special costs to be awarded against Teuton Resources Corp., pursuant to the order made by Justice Grauer in regard to the litigation between Teuton and American Creek in respect of the Treaty Creek property.

AMK had originally claimed that it was entitled to $2-million in special costs. Just prior to the hearing on March 31, 2015, AMK's solicitors had sent a revised bill of costs to Teuton asking for a total of $247,481.

This award of special costs became part of the appeal heard March 9 to 11, 2015. Judgment is currently under reserve and is expected within the next several months. The company expects a positive outcome to the appeal but cautions that there is no guarantee of such result.

The registrar adjourned generally the assessment originally scheduled for March 31 and April 1, 2015. The parties are at liberty to book a date to the mutual satisfaction of both parties. Recent inquiries with the Vancouver registry indicate that the earliest available two-day hearing is Oct. 5, 2015. The registrar ordered that Teuton pay AMK a total of $165,000 no later than June 1, 2015, as security for the costs yet to be assessed. Teuton's preliminary assessment of the quantum of special costs is in line with the $165,000 interim payment, and may have influenced the registrar's decision in setting that amount. The company is hopeful that the appeal decision will be rendered before June 1, 2015, making it unnecessary to make payment to AMK.

As at the date of its latest financial statements, Sept. 30, 2014, AMK's working capital deficiency was $2,474,908. For this reason, the company is concerned that AMK would be unable to pay it back the $165,000, should the appeal decision be rendered in Teuton's favour subsequent to June 1, 2015. This is in addition to its concern as to recovering the $621,712 already paid to AMK on account of party-and-party costs and disbursements.

Should the appeal decision not be rendered by June 1, 2015, the company is at liberty to apply for a stay of the interim payment pending the outcome of the appeal.

All of Teuton's mineral claims were formally returned to Teuton today and are again under Teuton's name in the mineral titles on-line system.

Castle Resource-Leduc silver claims

Also today, Teuton served notice on Castle Resources requesting that Castle return to Teuton all mineral claims held by Castle subject to the 2010 agreement between Castle and Teuton in respect of the Silver Leduc property. Castle was to make an annual royalty payment on Dec. 31, 2014, but failed to do so. Teuton alerted Castle as to the default, but no money came in within the three-month grace period in which Castle could have cured the default. That grace period expired yesterday, March 31, 2015.

In 2006, Bell Resources (which eventually sold the Granduc property and assigned the surrounding Silver Leduc option to Castle Resources) reported drilling of the JK zone on one of Teuton's Silver Leduc claims. This drilling resulted in intersections containing mineralization consistent with the Besshi-VMS copper-bearing bodies to the south at the formerly producing Granduc mine.

Glenn Zinn, chief executive officer and president of Bell, stated at the time that these intersections "are very exciting to the company [Bell] and worthy of further exploration." These Silver Leduc claims will be returned to Teuton.

Also included in the claims coming back to Teuton are the Pearson 1-4 claims. In 2007, Teuton personnel discovered a copper-bearing structure on these claims, which lie directly on strike with the prolific Granduc copper-bearing zones to the south-southwest. The zone was observed running up the side of a mountain for at least 400 metres before disappearing under talus cover.

We seek Safe Harbor.