In consideration for Lotus TV’s grant of the advertising right, CEM agreed to pay Lotus TV a fixed annual fee every year regardless of the total amount of advertising revenues received by CEM. Under the agreement, CEM paid Lotus TV an initial annual fee of approximately $128,900 (HK$1,000,000) for the first year of the agreement, which annual fee will increase at 10% every year for the following five years. As of March 31, 2016 and December 31, 2015, the Company had license fee payable of $51,922 and $0, respectively. For the three months ended March 31, 2016 and 2015, the Company recorded license fee expense of $51,796 and $47,195, respectively.

The Company’s future minimum annual license fee payments under the agreement for years ending December 31 after March 31, 2016 are as follows:

		Amount
Minimum license fee payable in 2016	$	155,765
Minimum license fee payable in 2017		207,687
Minimum license fee payable in 2018		207,687
Minimum license fee payable in 2019		207,687
Minimum license fee payable in 2020 and thereafter		138,458
Total	$	917,284