(DEPFA BANK LOGO) [y37714y3771404.gif]

      First Albany Companies 677 Broadway Albany, NY 12207
Facsimile:
  518-447-8606
Attention:
  General Counsel
 
    with a copy to:
 
    Dewey Ballantine LLP 1301 Avenue of the Americas New York, NY 10019
Facsimile:
  212-259-6333
Attention:
  Donald J. Murray
 
  Christopher P. Peterson

July 25, 2007
Ladies and Gentlemen:
Re: Notice and Waiver
     We refer to the Asset Purchase Agreement dated as of March 6, 2007 among
DEPFA BANK plc (“Buyer”), First Albany Capital Inc. (“Seller”) and First Albany
Companies Inc. (“Parent”) (the “Asset Purchase Agreement”). Capitalized terms
used but not otherwise defined herein shall have the meanings given to them in
the Asset Purchase Agreement.
     1. Section 4.1. Section 4.1 of the Asset Purchase Agreement provides the
Closing shall be consummated on the third Business Day following satisfaction or
waiver of all the conditions set forth in Articles IX and X of the Asset
Purchase Agreement, or at such other place or at such other date and time as
shall be agreed upon by Buyer and Seller. Buyer requests, and each of Seller and
Parent agrees that, the Closing shall be consummated on the tenth Business Day
following the satisfaction or waiver of all the conditions set forth in Articles
IX and X of the Asset Purchase Agreement, unless otherwise agreed by the
parties.
     2. Section 8.4(a). Section 8.4(a) of the Asset Purchase Agreement provides
that prior to the Closing Date, Buyer or its Affiliate shall offer to interview
each of the Employees who are in good standing with Seller with respect to a
potential offer of employment. Pursuant to Section 13.8 of the Asset Purchase
Agreement, which provides that any provision of the Asset Purchase Agreement may
be waived, Buyer requests that each of Seller and Parent agree to waive Buyer’s
obligation set forth in Section 8.4(a) to offer interviews prior to the Closing
Date to each of the Employees who are in good standing with Seller.
     Each of Seller and Parent agree to waive Buyer’s obligation set forth in
Section 8.4(a) to offer interviews prior to the Closing Date to each of the
Employees who are in good standing with Seller, subject to Buyer providing to
each Employee who is in good standing, for completion and return to Buyer (or
its Affiliate) within a specified period of time prior to the Closing Date, a
standard form of job application (substantially in the form of Exhibit A hereto)
and a current job description template.

      DEPFA BANK plc 1 Commons Street Dublin 1, Ireland
Phone:
  +353 1 792 2222
Fax:
  +353 1 792 2211 info@depfa.com www.depfa.com

Company Secretary:
Elaine Tiernan
Registered in Ireland
Company no. 348819
VAT no. IE6368819N
Board of Directors: G. Bruckermann, Dr. R. Brantner,
Prof. Dr. A. Hemmeirath, Dr. T. M. Kolbeck, H. W. Reich,
Prof. Dr. Dr. h.c. muh. H. Tietmeyer (all German)
J. Poos (Lux), D. M. Cahillanc, M. O’Connell (both Irish)

 

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     Together with such job application, Buyer will provide to each Employee,
for completion and return to Seller within a specified period of time prior to
the Closing Date, a form of request and consent (the “Request and Consent”)
(substantially in the form of Exhibit B hereto) requesting Seller’s Human
Resources Department to deliver to Buyer, and consenting to the delivery of, the
current and any deferred compensation details for such Employee, including
details of the last bonus awarded to such Employee. Seller will only deliver to
Buyer the current and any deferred compensation details, including details of
the last bonuses awarded, for those Employees who deliver (or cause to be
delivered) the Request and Consent to Seller. Buyer shall have no right to
receive from Seller’s Human Resources Department the current or any deferred
compensation details, including details of the last bonuses awarded, for those
Employees who do not deliver (or cause to be delivered) the Request and Consent
to Seller.
     3. Consents Regarding “First Albany” Name. In accordance with the terms of
and conditions of Section 13.4(a) of the Asset Purchase Agreement, upon written
notice to Parent and Seller, Buyer shall be permitted to assign the Asset
Purchase Agreement and the rights and obligations under it to a wholly owned
direct or indirect corporation or limited liability company organized under the
laws of the United States or any state thereof (the “Subsidiary”). Buyer
requests, and each of Seller and Parent consents that, Buyer shall be permitted
to change the name of the Subsidiary to include the words “First Albany”
effective at the close of business on the Business Day prior to Closing
(including filing an amendment to the organizational documents with the
Secretary of State of the State of New York to effect such name change);
provided, that if the Closing shall not occur for any reason on the scheduled
Closing Date, Buyer promptly shall cause the removal of the words “First Albany”
from the name of the Subsidiary.
Furthermore, Buyer requests, and each of Seller and Parent consents that:

  (i)   Buyer shall be permitted to communicate with third parties the scheduled
date of the Closing (once known) and, that upon Closing, (x) Buyer intends to
operate the Subsidiary under a name that includes the words “First Albany” and
(y) Buyer will have new third party clearing arrangements in relation to the
acquired Division, provided, that Buyer shall inform Seller and Parent of the
third parties Buyer intends to communicate with (other than (a) relevant
regulators, (b) clients of Seller, (c) counterparties of Seller, Buyer or the
Subsidiary, (d) service providers of Seller, Buyer or the Subsidiary or (e) U.S.
broker-dealers or other market participants with whom Seller interacts in the
ordinary course of business (collectively, “Permitted Parties”)) and such
communication to such third parties (other than Permitted Parties), and the form
of any written communication to such third parties and Permitted Parties (other
than relevant regulators), shall be subject to each of Seller’s and Parent’s
prior written approval, not to be unreasonably withheld or delayed; and     (ii)
  each of Seller and Parent shall cooperate in good faith on Buyer’s reasonable
requests with respect to the form of Parent’s or Seller’s communications to
third parties in relation to any name change of Seller effected prior to Closing
before any such communications shall be made by Seller or Parent to such third
parties.

     This waiver shall be effective upon execution and delivery by Seller and
Parent. This waiver shall be governed by, and construed in accordance with, the
internal laws (as opposed to the conflicts of law provisions) of the State of
New York. This waiver may be executed and delivered (including by facsimile
transmission) in several counterparts, each of which is an original, but all of
which taken together constitute one and the same agreement. The execution and
delivery of this waiver by each of Seller and Parent represents its irrevocable

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consent to, and acknowledgement of, the terms contained herein. The execution
and delivery of this waiver shall not, except as specifically provided herein,
constitute a waiver of any other provision of the Asset Purchase Agreement.
Except as specifically provided herein, the Asset Purchase Agreement shall
remain in full force and effect.
[SIGNATURE PAGE FOLLOWS]

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Please indicate your agreement to the foregoing by signing below.

              Very truly yours,
 
            DEPFA BANK plc
 
       
 
  By:   /s/ Willie Holohan
 
       
 
  Name:   Willie Holohan
 
  Title:   MANAGING DIRECTOR
 
       
 
  By:   /s/ John Andrade
 
       
 
  Name:   John Andrade
 
  Title:   Director

We confirm our agreement and acceptance of the foregoing.

          FIRST ALBANY COMPANIES INC.    
 
       
 
       
By:
  /s/ Peter J. McNierney    
 
       
Name:
  Peter J. McNierney    
Title:
  Chief Executive Officer    
 
       
 
        FIRST ALBANY CAPITAL INC.    
 
       
 
       
By:
  /s/ Peter J. McNierney    
 
       
Name:
  Peter J. McNierney    
Title:
  Chief Executive Officer    

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  July ___, 2007

CONFIDENTIAL
First Albany Companies Inc.
1 Penn Plaza
New York, NY 100119-4000
Attention: Human Resources Department
Ladies and Gentlemen:
     Re Request and Consent
     Reference is hereby made to the Asset Purchase Agreement (the “Asset
Purchase Agreement”), dated as of March 6, 2007, among DEPFA BANK plc, an Irish
public limited company (“DEPFA”), First Albany Capital Inc., a New York
corporation and First Albany Companies Inc., a New York corporation (the
“Company”), pursuant to which DEPFA has agreed to purchase certain assets of the
Municipal Capital Markets Group of the Company. Capitalized terms used but not
otherwise defined herein shall have the meanings given to them in the Asset
Purchase Agreement.
     In connection with the sale of the assets of the Municipal Capital Markets
Group to DEPFA, the undersigned Employee wishes to submit an application for
employment with DEPFA or its wholly-owned subsidiary. The Employee hereby
requests that the Company deliver to DEPFA the current and any deferred
compensation details for the Employee, including details of the last bonus
awarded to the Employee (such current and deferred compensation details and last
bonus awarded, the “Compensation Information”). The Employee understands that
without his/her consent, the Company will not deliver the Employee’s
Compensation Information to DEPFA.
     The execution and delivery of this letter by the Employee represents the
Employee’s irrevocable consent to, and agreement and acknowledgment of, the
terms contained herein and the Employee hereby waives all rights related to the
delivery of the Employee’s Compensation Information to DEPFA.
     This letter shall be effective upon execution by the Employee. This letter
shall be governed by and construed in accordance with the laws of the State of
New York.

     
 
  Very truly yours,
 
   
 
  EMPLOYEE
 
   
 
   
 
 
 
Name:
 
  Address:
 
   
 
  Telephone: