Document:

Exhibit
10.1

FIRST AMENDMENT AGREEMENT 

THIS FIRST AMENDMENT AGREEMENT (this “First
Amendment Agreement”) is entered into this 15th day of June, 2007 among KKR
Financial Holdings LLC, a Delaware limited liability company (the “Company”),
KKR Financial Advisors LLC, a Delaware limited liability company (together with
its permitted assignees, the “Manager”), and KKR Financial Corp., a
Maryland corporation (“KKR Corp.”).

W I T N E S S E T H:

WHEREAS, the Company, KKR Corp. and the Manager are
parties to an Amended and Restated Management Agreement, dated as of May 4,
2007 (the “Amended and Restated Management Agreement”); and

WHEREAS, the parties hereto desire to amend the
definition of “Equity” in Section 1(f) of the Amended and Restated Management
Agreement as set forth herein.

NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements herein contained and other good and
valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows (all
capitalized terms used but not defined herein shall have the meanings specified
in the Amended and Restated Management Agreement):

Section 1.  Amendment
to the Amended and Restated Management Agreement.

Section 1(f) of the
Amended and Restated Management Agreement is hereby amended and restated in its
entirety to read as follows:

“Equity” means,
for purposes of calculating the Base Management Fee, for any month the sum of
(i) the aggregate net proceeds from any issuance of any Shares, or preferred
shares of the Company, (ii) the aggregate net proceeds from the sales of trust
preferred securities issued after June 15, 2007 by the Company, a subsidiary of
the Company or entities sponsored by the Company to issue trust preferred
securities, (iii) the aggregate net proceeds from the sales of any securities
convertible into Shares or any other securities issued by the Company provided
that the Board of Directors has determined to classify such securities as
Equity for purposes of the definition of “Equity” and has pre-approved the sale
of such securities and (iv) the aggregate net proceeds from the sales of any
securities issued by the Company that do not constitute indebtedness on the
Company’s financial statements in accordance with GAAP provided that the Board
of Directors has determined to classify such securities as Equity for purposes
of the definition of “Equity” and has pre-approved the sale of such securities
(collectively, the “Equity Securities”), in each case after deducting
any underwriting discounts and commissions and other expenses and costs
relating to the issuance or sales, plus the Company’s retained earnings at the
end of such month (without taking into account any non-cash equity compensation
expense incurred in current or prior periods), which amount shall be reduced by
the amount of Equity Securities that may be repurchased or repaid by the
Company or its subsidiaries; provided that the foregoing calculation of Equity
shall be adjusted to exclude one-time events pursuant to 

changes in GAAP, as well
as non-cash charges after discussion between the Manager and the Independent
Directors and approval by a majority of the Independent Directors in the case
of non-cash charges. For any month during which there is an issuance of any
Equity Securities (a “New Issuance”), Equity shall be equitably adjusted
for the month so as to take into consideration the amount of Equity before and
after any New Issuance.  Notwithstanding
the foregoing, in the event the Company or its subsidiaries repurchase any
common shares, the Board of Directors, in its sole discretion, may make a
determination that no reduction to Equity shall be made for such repurchase of
common shares if the Company or any of its subsidiaries intend to temporarily
hold such repurchased common shares and to reissue such common shares in the
future.  On at least an annual basis, the
Manager and the Board of Directors shall evaluate whether it is appropriate to
amend the definition of “Equity” to expand and/or to modify the term to
include, if appropriate, new classes of hybrid securities (i.e., securities
having both equity and debt characteristics) and/or to align the term with
current market practice.

Section 2.  Miscellaneous.  This First Amendment Agreement may be
executed in one or more counterparts, all of which shall be considered one and
the same agreement and shall become effective when one or more counterparts
have been signed by each of the parties hereto and delivered to the other
parties hereto.  This First Amendment
Agreement may be executed by facsimile signature.

Section 3.  Governing
Law.  This First Amendment Agreement and the rights
and obligations of the parties hereunder shall be governed by, and construed
and interpreted in accordance with, the law of the State of New York.

[Remainder of page intentionally left blank.]

                 
 

IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment Agreement as of the date first written above.

 

	
  

  	
  KKR FINANCIAL HOLDINGS LLC

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Saturnino S. Fanlo

  
	
   

  	
  Name:

  	
  Saturnino S. Fanlo

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  KKR FINANCIAL ADVISORS LLC

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David A. Netjes

  
	
   

  	
  Name:

  	
  David A. Netjes

  
	
   

  	
  Title:

  	
  Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
  KKR FINANCIAL CORP.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David A. Netjes

  
	
   

  	
  Name:

  	
  David A. Netjes

  
	
   

  	
  Title:

  	
  Chief Operating OfficerExhibit 10.1

  , 2007

Stone Tan China Acquisition Corp.

9191 Towne Center Drive, Suite 410

San Diego, California 92122

Morgan Joseph & Co.
Inc.

600 Fifth Avenue, 19th Floor

New York, New York 10020

Re:          Initial
Public Offering

Gentlemen:

The undersigned stockholder,
officer and director of Stone Tan China Acquisition Corp. (“Company”), in
consideration of Morgan Joseph & Co., Inc. (“Morgan Joseph”) entering into
a letter of intent (“Letter of Intent”) to underwrite an initial public
offering of the securities of the Company (“IPO”) and embarking on the IPO
process, hereby agrees as follows (certain capitalized terms used herein are
defined in paragraph 11 hereof):

1.             If the Company solicits approval of
its stockholders of a Business Combination, the undersigned will vote all
Insider Shares owned by him in accordance with the majority of the votes cast
by the holders of the IPO Shares and will vote all shares of Common Stock of
the Company acquired by him in the IPO or aftermarket in favor of any Business
Combination negotiated by the officers of the Company.

2.             In the event that the Company fails
to consummate a Business Combination within 24 months from the effective date (“Effective
Date”) of the registration statement relating to the IPO (such date being
referred to herein as the “Termination Date”), the undersigned shall take all
such action reasonably within its power as is necessary to dissolve the Company
and liquidate the Trust Account to holders of IPO Shares as soon as reasonably
practicable.

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The undersigned hereby
waives any and all right, title, interest or claim of any kind in or to any
distribution of the Trust Account (as defined in the Letter of Intent) and any
remaining net assets of the Company as a result of such liquidation with
respect to its Insider Shares (“Claim”) and will not seek recourse against the Trust
Account for any reason whatsoever. In the event of the liquidation of the Trust
Account, the undersigned agrees to indemnify and hold harmless the Company
jointly and severally with Roger W. Stone, against any and all loss, liability,
claims, damage and expense whatsoever (including, but not limited to, any and all
legal or other expenses reasonably incurred in investigating, preparing or
defending against any litigation, whether pending or threatened, or any claim
whatsoever) which the Company may become subject as a result of any claim by
any third party if such third party did not execute a waiver of claims
against the Trust Account, but only to the extent necessary to ensure that
such loss, liability, claim, damage or expense does not reduce the amount in
the Trust Account. The foregoing section is not for the benefit of any third
party beneficiaries of the Company and does not create any contract right in
favor of any person other than the Company.

3.             In order to minimize potential conflicts of
interest which may arise from multiple affiliations, the undersigned agrees (i) not
to become an officer, director or principal stockholder of a blank check
company engaged in business activities similar to those intended to be
conducted by the company and (ii) to present to the Company for its
consideration, prior to presentation to any other person or entity, any
suitable opportunity to acquire an operating business, until the earlier of the
consummation by the Company of a Business Combination, or the liquidation of
the Company, subject to any pre-existing fiduciary and contractual obligations
the undersigned might have. For the purposes hereof, a suitable
opportunity shall mean any company or business having its primary operations in
the People’s Republic of China whose fair market value is at least equal to 80%
of the balance of the Trust Account (less deferred underwriting compensation of
$2,000,000, or $2,300,000 if the over-allotment is exercised in full and taxes
payable).

4.             The undersigned acknowledges and
agrees that the Company will not consummate any Business Combination which
involves a company which is currently a portfolio company of, or affiliated
with, any of the Insiders. The undersigned acknowledges and agrees that the
Company will not consummate any Business Combination which involves a company
which in the future becomes affiliate with any of the Insiders, unless the
Company obtains an opinion from an independent investment banking firm that the
Business Combination is fair to the Company’s stockholders from a financial
perspective.

5.             Prior to a Business Combination,
neither the undersigned, any member of the family of the undersigned, nor any
affiliate (“Affiliate”) of the undersigned will be entitled to receive and will
not accept any compensation for services rendered to the Company.
Notwithstanding the foregoing to the contrary, the undersigned shall be
entitled to reimbursement from the Company for his out-of-pocket expenses
incurred in connection with seeking and consummating a Business Combination and
commencing on the Effective Date, Pacific Millennium, an affiliate of the
Company’s Chief Executive Officer (“Related Party”), shall be allowed to charge
the Company $7,500 per month to compensate it for the Company’s use of the
Related Party’s office space and certain technology and administrative and
secretarial services.

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6.             Neither the undersigned, any member
of the family of the undersigned, nor any Affiliate of the undersigned will be
entitled to receive or accept a finder’s fee or any other compensation in the
event the undersigned, any member of the family of the undersigned or any
Affiliate of the undersigned originates a Business Combination.

7.             The undersigned will escrow its
Insider Shares for the three year period commencing on the Effective Date
subject to the terms of a Stock Escrow Agreement which the Company will enter
into with the undersigned and an escrow agent acceptable to the Company.

8.             The undersigned agrees to be the Chief
Executive Officer of the Company and a member of the Company’s board of
directors until the earlier of the consummation by the Company of a Business
Combination or the liquidation of the Company provided, however that the
undersigned is not obligated to contribute a minimum number of hours per week
to the Company’s business or operations. The undersigned’s biographical
information furnished to the Company and Morgan Joseph and attached hereto as
Exhibit A is true and accurate in all respects, does not omit any material
information with respect to the undersigned’s background and contains all of
the information required to be disclosed pursuant to Item 401 of Regulation
S-K, promulgated under the Securities Act of 1933. The undersigned’s
Questionnaire furnished to the Company and Morgan Joseph and annexed as
Exhibit B hereto is true and accurate in all respects. The undersigned
represents and warrants that:

(a)           he
is not subject to or a respondent in any legal action for, any injunction,
cease-and-desist order or order or stipulation to desist or refrain from any
act or practice relating to the offering of securities in any jurisdiction;

(b)           he
has never been convicted of or pleaded guilty to any crime (i) involving any
fraud or (ii) relating to any financial transaction or handling of funds of
another person, or (iii) pertaining to any dealings in any securities and he is
not currently a defendant in any such criminal proceeding; and

(c)           he
has never been suspended or expelled from membership in any securities or
commodities exchange or association or had a securities or commodities license
or registration denied, suspended or revoked.

9.             The undersigned has full right and
power, without violating any agreement by which he is bound, to enter into this
letter agreement and to serve as Chief Executive Officer of the Company and a
member of the Company’s board of directors.

10.           This letter agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of New York, without giving effect to conflicts of law principles that would
result in the application of the substantive laws of another jurisdiction. The
undersigned hereby (i) agrees that any action, proceeding or claim against him
arising out of or relating in any way to this letter agreement (a “Proceeding”)
shall be brought and enforced in the courts of the State of New York of the
United States of America for the Southern District of New York, and irrevocably
submits to such jurisdiction, which jurisdiction shall be exclusive, (ii)
waives any objection to such exclusive jurisdiction and that such courts
represent an inconvenient forum and (iii) irrevocably agrees to appoint Loeb
& Loeb LLP as agent for the service of process in the State of New York to
receive, for the undersigned and on his behalf, service of process in any Proceeding.
If for any reason such agent is unable to act as such, the undersigned will
promptly notify the Company and Morgan Joseph and appoint a substitute 

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agent acceptable to each
of the Company and Morgan Joseph within 30 days and nothing in this letter will
affect the right of either party to serve process in any other manner permitted
by law.

11.           As used herein, (i) a “Business
Combination” shall mean an acquisition by merger, capital stock exchange, asset
or stock acquisition, reorganization or otherwise, of one or more operating
businesses in the media and advertising industry in People’s Republic of China
selected by the Company; (ii) “Insiders” shall mean all officers, directors and
stockholders of the Company immediately prior to the IPO; (iii) “Insider Shares”
shall mean all of the shares of Common Stock of the Company owned by an Insider
prior to the IPO; (iv) “IPO Shares” shall mean the shares of Common Stock
issued in the Company’s IPO; and (v) “Trust Account” shall mean the trust
account established by the Company at the consummation of its IPO and into
which a certain amount of the net proceeds of the IPO is deposited.

	
   

  	
  STONE TAN CHINA ACQUISITION
  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Richard Tan,
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INSIDER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Richard Tan

  

 

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EXHIBIT A

[Insider biographical information]

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EXHIBIT B

[Insider questionnaire]

 

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