EXHIBIT 4.16 COOPERATION AGREEMENT

 

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                                                                    EXHIBIT 4.16

 

                              COOPERATION AGREEMENT

 

This Agreement (the "Agreement") is made and entered into by and between

 

Mitsubishi Corporation, a corporation organized and existing under the laws of

Japan and having its principal place of business at 6-3, Marunouchi 2-chome,

Chiyoda-ku, Tokyo, Japan, (hereinafter "LICENSOR")

 

and

 

Huitong Information Technology Ltd., a wholly-owned Linktone Ltd. company

established under the laws of the People's Republic of China (the "PRC" or

"China"), having its principal place of business at 6/F Eastern Tower, 689

Beijing East Road, Shanghai, 200001 PR China (hereinafter "LICENSEE")

 

as of the Effective Date (as defined below).

 

WHEREAS Licensee provides Mobile Entertainment Content in the PRC, excluding

Hong Kong SAR, Macau SAR and Taiwan (hereinafter the "TERRITORY") to End-Users

as defined below;

 

WHEREAS the Parties agree that Licensee shall, through its Distributors

distribute and make available to End-Users in the Territory the Mobile

Entertainment Services provided by Licensor.

 

NOW THEREFORE, the Parties hereby agree as follows:

 

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1. DEFINITIONS

 

"Content"                     Digital items made available by Licensor to the

                              Licensee for further distribution to End-Users, as

                              defined pursuant to the Service Description and

                              Schedule (Schedule 1) and the Service Revenue

                              Schedule (Schedule 2).

 

"Distributor"                 For purpose of this agreement Distributor shall

                              mean the following distribution channels: China

                              Mobile and China Unicom

 

"Effective Date"              January 1, 2005

 

"End-User"                    The person who uses the Content on his/her mobile

                              handset; usually a subscriber of the mobile

                              communications network

 

"Gross Revenue"               All gross revenues generated from the download of

                              the content by end-users during the term of this

                              Agreement;

 

"Item"                        A specific piece of Content to be made available

                              to an End-User

 

"Net Revenue"                 The Gross Revenue less any mobile operator's share

                              of the Gross Revenue, bad debt, business and

                              withholding taxes applicable thereto under PRC

                              laws and regulations. If payment is remitted to a

                              local, China-based company, then payment will be

                              remitted without deducting withholding tax,

                              However, if revenues are remitted outside of

                              China, then withholding tax is applicable.

 

"Licensee's Systems"          The technical systems owned and operated by the

                              Licensee.

 

"Service(s)"                  The service(s) selected by Licensee pursuant to

                              and as described in Schedule I

 

"Territory"                   The PRC China excluding Hong Kong SAR, Macau SAR

                              and Taiwan.

 

2. LICENSOR'S OBLIGATIONS

 

2.1   Licensor shall provide Mobile Entertainment Services as selected by the

      Licensee pursuant to and as described in the Schedule I.

 

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2.2   Licensor grants to the Licensee a non-exclusive license for the duration

      of this Agreement to utilize certain of its content by making such content

      available to End-Users in the Territory. The Content to be licensed by

      Licensor is the Content as set out in Schedule I. Licensor will inform the

      Licensee in written form about the duration of which each individual Item

      can be provided.

 

3.    CHARGES; INVOICING

 

3.1   The Licensee will pay to Licensor a share of Net Revenue to be paid by the

      End-Users for using the Content as set out in Schedule II ("Revenue

      Share"). The Gross Revenue wilL be based on the kind and the number of

      Items made available by Licensee to End-Users.

 

3.2   The prices to be charged by Licensee to the End-Users in respect of any

      Item will be agreed upon between the parties.

 

3.3   Licensee will provide Licensor with a monthly report identifying the

      number of Items made available to End-Users within 30 days after the end

      of the relevant calendar month.

 

      Monthly report of the items shall include such details as the number of

      downloads per each individual graphics and each line item needed to

      calculate the Net Revenue.

 

3.4   Licensee shall have the sole responsibility to bill the End-Users, i.e.

      the Licensee's Subscribers and collect Net Revenues

 

3.5   Upon receiving the Monthly Report, Licensor will issue a respective

      invoice to the Licensee.

 

3.6   Licensee shall pay to Licensor the Revenue Share on a quarterly basis

      (January-March, April-June, July-September, October-December), within 30

      days after Licensee receives payment for the final month of the preceding

      quarter from the mobile Operators. If the total Revenue Share due to

      Licensor from one quarter does not exceed US$100, then payment will be

      made when the cumulative Revenue Share due totals US$100. Payment shall be

      made by wire transfer to Licensor's bank account.

 

3.7   In case of a default for any amount, and save any further rights of

      Licensor to claim damages, Licensee shall pay to Licensor an interest rate

      of LIBOR + 0.5% per annum on the outstanding amount.

 

3.8   Licensor should pay 5% business tax and 10% withholding tax levied by any

      governmental authority in the course of remitting Licensor's Revenue Share

      from Licensee.

 

4.    LICENSEE'S OBLIGATIONS

 

4.1   The Licensee shall obtain the Content from the Licensor and shall

      distribute the Content over the Distributor's channels. All content

      distributed through the Distributor's channels must first be approved by

      the Licensor. The Licensee shall provide the content to be

 

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      approved by the Licensor either by e-mail or FTP. All data related to the

      Item provided to the end-user shall be kept in storage for three years

      from the date of Item provided to the end-user.

 

4.2   The Licensee shall market the Services provided by Licensor and use its

      reasonable endeavors to try to obtain such Content a favorable positioning

      within the relevant category of offerings to End-Users.

 

      Medias used to market the service shall include but not limited to

      Televisions, Magazines, Newspapers, Events, Internet medias. Cost needed

      to market the service shall be borne by Licensee. All materials used for

      marketing purpose must first be approved by the Licensor.

 

4.3   The Licensee shall comply with all applicable legal obligations when

      advertising and/or making available the Content to End-Users. In

      particular, the Licensee is responsible that no Content is made available

      to End-Users that is objectionable in the Territory, including but not

      limited, for reasons of minor protection, for ethical, religious or

      political reasons or which might otherwise constitute a criminal offence

      in the Territory. The Licensee shall comply with any laws and regulations

      protection personal data and the privacy of the End-User.

 

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