Well as the error says you have url file-access disabled. But why are you using the http at all if the file is in the same server?
So instead of:
$localfile = 'http://mysite1.com/layouts/content/template4/About.htm';
Use server file path:
$localfile = '/home/user/domain/public_html/layouts/content/temlate4/About.htm';
Ofcourse change that path to what it really is 😉
To enable the url wrapper change allow_url_fopen to On in your php.ini.