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Licensing

5. License Terms to NFTs​

All Intellectual Property Rights in and to the Artwork, designs, characters, lore, universe, names, logos, and other creative elements embodied in or associated with the NFTs (collectively, the "IP") are and shall remain the exclusive property of the Company. Ownership of an NFT confers no transfer of ownership of the IP itself, but only the limited license rights expressly granted below.

5.1. General License Terms​

Buyers are authorized to use the NFTs for both commercial and personal purposes, including the creation and sale of derivative works, as long as they remain in possession of the NFT. The License is transferable solely through secondary sales on the Marketplace. The License is revocable and applicable to the NFT owner for the use, copying, display, and enjoyment of the associated Art, including:

  • Personal and commercial use.
  • Participation in Marketplaces allowing NFT sale or transfer.
  • Presentation in online galleries showcasing the associated Art.

This License is constrained by the duration of your NFT Ownership. Upon the sale of the NFT to a new party in a secondary transaction, the License is reassigned to the new NFT Buyer. The rights conferred by the License to you as the original owner cease to be effective upon such transfer. You are obligated to bring the contents of this License to the attention of the new Buyer before completing the NFT sale. It is clarified that the sale of the NFT in itself does not qualify as a "commercial use" of the NFT within the framework of this License.

5.2. Grant of Limited Commercial IP License to NFT Holders​

Subject to continuous ownership of a valid CyberThrone NFT and compliance with these Terms, the Company grants the NFT holder a non-transferable, non-sublicensable, revocable, worldwide limited commercial license to use the Artwork associated with the NFT ("Limited IP License"). The Limited IP License permits the NFT holder to exploit the Artwork solely as incorporated into new creative works or products, and only in accordance with Section 5.7 (Permitted Uses) and Section 5.8 (Brand & Reputation Restrictions). The Limited IP License automatically terminates upon: transfer or sale of the NFT; breach of these Terms; or written notice of termination by the Company following a material breach.

5.3 Optional License-Back to the Company (Revenue Participation Model)​

NFT holders may elect to license their Limited IP License back to the Company ("License-Back Election").

(a) License-Back Grant. Upon making a License-Back Election, the NFT holder grants the Company a non-exclusive, worldwide, sublicensable license to commercially exploit the Artwork associated with the NFT.

(b) Annual License Fee. In consideration of the License-Back, the Company shall pay the NFT holder an annual license fee equal to twenty-five percent (25%) of Net Revenue derived from digital exploitation of the CyberThrone IP. Net Revenue includes, without limitation: royalties from current or future NFT or digital collections; software or platform licensing revenues; digital book or print-on-demand book sales; digital or physical merchandise sales; music royalty income; graded or digital trading card game (TCG) sales; any other digital or blockchain-based commercial use of the IP. Net Revenue shall exclude taxes, refunds, chargebacks, and third-party marketplace fees.

(c) Election Mechanics. License-Back participation is opt-in only and shall be governed by a separate written election mechanism or smart contract process designated by the Company. NFT holders who do not opt in retain their Limited IP License under Section 5.5.

5.4. Transfer of Licence upon Sale of NFT​

Upon the sale of any NFT you own, the License automatically transfers to the Buyer acquiring the NFT. The Ownership of the NFT is contingent upon compliance with the terms outlined in this License.

It's crucial to note that nothing in this License is intended to, or shall operate to, confer Ownership of any Intellectual Property Rights or other rights related to the associated Art upon the NFT owner. The License remains the primary basis for the permissible use of the Art associated with the NFT.

5.5 Independent Commercial Use Below Revenue Threshold​

NFT holders may elect to license their Limited IP License back to the Company ("License-Back Election").

(a) License-Back Grant. Upon making a License-Back Election, the NFT holder grants the Company a non- exclusive, worldwide, sublicensable licence to commercially exploit the Artwork associated with the NFT.

(b) Revenue Share. In consideration of the License-Back, the Company shall distribute to eligible participating NFT holders an amount equal to twenty-five percent (25%) of the Company's Net Revenue derived from the digital exploitation of the CyberThrone IP. Net Revenue includes, without limitation: royalties from current or future NFT or digital collections; software and platform licensing revenue; digital book and print-on-demand book sales; digital or physical merchandise sales; music royalty income; graded or digital trading card game (TCG) sales; and any other digital or blockchain-based commercial exploitation of the CyberThrone IP. Net Revenue excludes taxes, refunds, chargebacks, payment processing fees, third-party marketplace fees, and other legitimate business expenses. Revenue share distributions shall be made quarterly, commencing in 2028. Each revenue share period shall begin on the 15th day of the first month of the quarter and end on the 15th day of the third month of the quarter. The initial revenue share period shall run from 15 December 2027 to 15 March 2028, with the first distribution scheduled to be made on or before 31 March 2028, provided the participant satisfies all eligibility requirements. Revenue share distributions are based solely on the Company's Net Revenue for the applicable revenue share period. If no Net Revenue exists for a particular period, no revenue share distribution shall be payable for that period.

(c) Election Mechanics. Participation in the License-Back and Revenue Share Program is voluntary and requires the NFT holder to complete the Company's designated opt-in process. Eligibility shall be verified through a combination of on-chain ownership verification and the Company's official records confirming that the NFT holder has successfully completed the License-Back Election. Ownership of a CyberThrone NFT alone does not qualify the holder to participate in the Revenue Share Program.

5.6 Extended Commercial Rights Above Revenue Threshold​

If an NFT holder's gross annual revenue derived from use of the Artwork exceeds USD $100,000, the Limited IP License shall no longer be sufficient. The NFT holder must:

(i) cease further commercial exploitation beyond the threshold; and

(ii) contact business@cyberthrone.io to apply for an Extended IP License. Grant of any Extended IP License is at the Company's sole discretion and subject to separate written agreement, which may include revised royalty terms, audit rights, and brand controls.

5.7 Permitted Creative Uses​

Subject to compliance with these Terms, NFT holders may use the Artwork to create and monetize:

(i) merchandise (including clothing, posters, collectibles, and physical or digital goods);

(ii) comics, graphic novels, or illustrated books;

(iii) animated videos, short films, or web series;

(iv) games or mini-games featuring the NFT characters or universe;

(v) music projects incorporating the NFT characters, branding elements, or lore;

(vi) and (vii) YouTube channels, podcasts, or social media content. All uses must be derivative and must not involve standalone exploitation of raw design files or traits.

5.8 Brand, Attribution & Reputation Restrictions​

The Limited IP License is subject to strict brand protection conditions:

No Brand Creation. NFT holders may not:

(i) present the Artwork or NFT as their own brand;

(ii) register or use trademarks, trade names, logos, or domain names derived from the Artwork or CyberThrone IP;

(iii) suggest sponsorship, endorsement, or official affiliation with the Company. Any business, project, or product created by the NFT holder must operate under a distinct name and branding unrelated to CyberThrone, and clearly avoid consumer confusion as to source or ownership.

Reputation Protection. The Artwork may not be used in any manner that is defamatory, obscene, hateful, misleading, illegal, or otherwise reasonably likely to harm the reputation, goodwill, or integrity of the CyberThrone brand.

No Token or Collection Misrepresentation. NFT holders may not mint, issue, or promote additional NFTs, tokens, or collections using the Artwork or confusingly similar designs.

5.9. License Restrictions​

In addition to the protections outlined in section 5.7 above, certain limitations are imposed on the use of our NFTs, and we retain the underlying rights to enforce these restrictions.

While utilizing the NFTs you own, you are prohibited from:

  • Inappropriate Use: Using the Art in connection with materials depicting hate, violence, intolerance, cruelty, or other inappropriate behavior that could reasonably be considered to bring the owner of the material into disrepute or infringe on the rights of others.
  • Commercial Purpose Restrictions: Seeking to use the Art or NFT for commercial purposes, excluding a bona fide secondary sale of the NFT to a Buyer, conditional upon the Revenue Share payment being made, except as allowed for under the License terms stated herein.
  • Intellectual Property Restrictions: Seeking to register a trademark or acquire Intellectual Property Rights in the Art or attempting in any other manner to claim ownership in the Art.
  • Prohibition on Further NFT Issuance: Causing, directly or indirectly, the further issuance of an NFT claiming an association with the Art or purporting to be an NFT of the Art, or which is a derivative work of the Art.
  • Consistency with License Rights: Asserting any right to or over the material in any manner inconsistent with the rights under this License.
  • Challenge to Creator's Title: Taking any action that would or might invalidate, challenge, oppose, infringe, or otherwise put in dispute the Creator's title to any Intellectual Property Rights in the Art.
  • Assistance Prohibition: Causing, permitting, or assisting any other person directly or indirectly to do any of the above acts.

For the avoidance of doubt, the restrictions on the License survive termination or assignment transfer of this License. The Company reserves the right to:

(i) request reasonable revenue attestations where commercial use is apparent;

(ii) require cessation of non-compliant uses; or

(iii) revoke the Limited IP License upon breach. Failure to comply may result in termination of license rights without compensation.

You acknowledge that the NFTs you own contains individual layered files and traits owned by us. The individual layered files, traits, and Art of the NFT you own may not be used individually, separately, or in combination with each other, other than as provided herein, for commercial or any other purpose.

NFTs of Genesis collection you own may only be used for commercial purposes in its entirety as a whole or as a basis for derivative works substantially altered from the original NFT and Art (background may be removed but not used individually). However, under no circumstances shall the NFT and Art be used to:

  • Create merchandise using the NFT once you no longer own that NFT.
  • Create, sell, or promote Counterfeit NFTs or associated collections.
  • Create any derivative works in violation of the mentioned License terms stated herein.
  • Sell or sublicense the rights on the NFT without paying Revenue Share.

5.10. License Termination​

If you breach any License terms outlined herein, we reserve the right to terminate the License without any notice or compensation. Further actions may be taken, including publishing the termination of the License and/or seeking to block the Art or the listing of an NFT subject to removal from any Marketplaces and third-party websites.

Upon termination of these License terms, the rights granted by the License in respect of an NFT you own will cease immediately. This encompasses the rights to use, copy, display, create derivative works, and otherwise enjoy the Art associated with the NFT you own.

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