Exhibit 10.3WAIVER AND AMENDMENTTHIS WAIVER AND AMENDMENT (this “**Amendment**”) is made as of August 9, 2006, among Infinity EnergyResources, Inc., a Delaware corporation (including as successor to Infinity, Inc., “**Infinity**”),HFTP Investment L.L.C. (“**HFTP**”), Gaia Offshore Master Fund, Ltd. (“**Gaia**”), AG OffshoreConvertibles, Ltd. (“**AG Offshore**”), Leonardo, L.P. (“**Leonardo**”) and Portside Growth & OpportunityFund (“**Portside**” and collectively with HFTP, Gaia and AG Offshore, the “**Buyers**”), and ConsolidatedOil Well Services, Inc., a Kansas corporation and wholly-owned subsidiary of Infinity(“**Consolidated**”), CIS-Oklahoma, Inc., a Kansas corporation and wholly-owned subsidiary of Infinity(“**CIS**”), Infinity Oil & Gas of Wyoming, Inc., a Wyoming corporation and wholly-owned subsidiary ofInfinity (“**Infinity-Wyoming**”), Infinity Oil & Gas of Kansas, a Kansas corporation and wholly-ownedsubsidiary of Infinity (“**Infinity-Kansas**”), and Infinity Oil and Gas of Texas, Inc., a Delawarecorporation and wholly-owned subsidiary of Infinity (“**Infinity-Texas**,” and together withConsolidated, CIS, Infinity-Wyoming, Infinity-Kansas and Infinity-Delaware, the “**Subsidiaries)**.Unless otherwise indicated or defined herein, capitalized terms used herein shall have the meaningsascribed to them in the Securities Purchase Agreement (as defined below).W I T N E S S E T H:     WHEREAS, Infinity, HFTP, AG Offshore and AG Domestic Convertibles, L.P. (“**AG Domestic**”)entered into that certain Securities Purchase Agreement, dated as of January 13, 2005 (as amended,restated, supplemented or otherwise modified and in effect from time to time, the “**SecuritiesPurchase Agreement**”);     WHEREAS, pursuant to the Securities Purchase Agreement, Infinity issued to HFTP, AG Domesticand AG Offshore senior secured notes (such notes, together with any promissory notes issued inexchange or substitution therefor or replacement thereof, and as any of the same may be amended,restated, modified, supplemented or otherwise modified and in effect from time to time, the“**January 2005 Notes**”), dated January 13, 2005, in an initial aggregate principal amount of$30,000,000 and warrants (such warrants, together with any warrants or other securities issued inexchange or substitution thereof or replacement thereof and as any of the same may be amended,restated, supplemented or otherwise modified and in effect from time to time, the “**January 2005Warrants**”), dated January 13, 2005, to purchase shares of the common stock, par value $0.0001 pershare (the “**Common Stock**”), of the Company;     WHEREAS, AG Domestic subsequently assigned to AG Offshore the January 2005 Notes and January2005 Warrants held by AG Domestic and AG Domestic’s rights and obligations with respect to any andall future sales of Additional Notes and Additional Warrants by the Company pursuant to theSecurities Purchase Agreement;     WHEREAS, Infinity, HFTP, Gaia, AG Offshore, the Subsidiaries and Agent entered into thatcertain First Additional Closing Agreement, dated as of September 7, 2005 (the “**First AdditionalClosing Agreement**”), pursuant to which, among things, the January 2005 Notes were amended and Gaiawas made a Buyer under the Securities Purchase Agreement;
 

 
     WHEREAS, pursuant to the Securities Purchase Agreement and the First Closing Agreement, theCompany issued to HFTP, Gaia and AG Offshore senior secured notes (such notes, together with anypromissory notes issued in exchange or substitution therefor or replacement thereof, and as any ofthe same may be amended, restated, modified, supplemented or otherwise modified and in effect fromtime to time, the “**September 2005 Notes**”), dated September 7, 2005, in an initial aggregateprincipal amount of $9,500,000 and warrants (such warrants, together with any warrants or othersecurities issued in exchange or substitution thereof or replacement thereof and as any of the samemay be amended, restated, supplemented or otherwise modified and in effect from time to time, the“**September 2005 Warrants**”), dated September 7, 2005, to purchase shares of Common Stock;     WHEREAS, Infinity, HFTP, Gaia, AG Domestic, AG Offshore, the Subsidiaries and Agent enteredinto that certain Master Assumption and Reaffirmation of Transaction Documents dated as ofSeptember 9, 2005, pursuant to which, among other things, Infinity assumed all of the obligationsof Infinity, Inc. under the Securities Purchase Agreement, the January 2005 Notes, the January 2005Warrants, the September 2005 Notes, the September 2005 Warrants and the other TransactionDocuments;     WHEREAS, pursuant to the Securities Purchase Agreement, the Company issued to HFTP, Gaia andAG Offshore senior secured notes (such notes, together with any promissory notes issued in exchangeor substitution therefor or replacement thereof, and as any of the same may be amended, restated,modified, supplemented or otherwise modified and in effect from time to time, the “**December 2005Notes**”), dated December 9, 2005, in an initial aggregate principal amount of $5,500,000 andwarrants (such warrants, together with any warrants or other securities issued in exchange orsubstitution thereof or replacement thereof and as any of the same may be amended, restated,supplemented or otherwise modified and in effect from time to time, the “**December 2005 Warrants**”),dated December 9, 2005, to purchase shares of Common Stock;     WHEREAS, Infinity, HFTP, Gaia, AG Offshore, Leonardo the Subsidiaries and Agent entered intothat certain Third Additional Closing Agreement, dated as of March 17, 2006, (the “**Third AdditionalClosing Agreement**”), pursuant to which, among other things, Leonardo was made a Buyer under theSecurities Purchase Agreement;     WHEREAS, pursuant to the Securities Purchase Agreement and the Third Additional ClosingAgreement, the Company issued to Gaia and Leonardo senior secured notes (such notes, together withany promissory notes issued in exchange or substitution therefor or replacement thereof, and as anyof the same may be amended, restated, modified, supplemented or otherwise modified and in effectfrom time to time, the “**March 2006 Notes**” and, collectively with the January 2005 Notes, theSeptember 2005 Notes and the December 2005 Notes, the “**Notes**”), dated March 17, 2006, in an initialaggregate principal amount of $8,000,000 and warrants (such warrants, together with any warrants orother securities issued in exchange or substitution thereof or replacement thereof and as any ofthe same may be amended, restated, supplemented or otherwise modified and in effect from time totime, the “**March 2006 Warrants**” and, collectively with the January 2005 Warrants, the September2005 Warrants, and the December 2005 Warrants, the “**Warrants**”), dated March 17, 2006, to purchaseshares of Common Stock;
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     WHEREAS, Portside currently holds a portion of the Notes and the Warrants; and     WHEREAS, the Company has incurred Indebtedness (as defined in the Notes) in the form of (i)obligations issued, undertaken or assumed as the deferred purchase price of property or servicesconsisting of unsecured account trade payables (**“Accounts Payable"**) in the oil and gas productionsegment of the Company’s business (the Accounts Payable in such segment, the “**O & G AccountsPayable**”) exceeding an aggregate among the Company and its Subsidiaries of $5,000,000 and (ii)Accounts Payable unpaid in excess of 90 days beyond invoice due date (collectively, the “**AccountsPayable Default**”), resulting in the breach of Section 4(n) of the Securities Purchase Agreement andSection 12 of each of the Notes and the occurrence of a Triggering Event (as defined in the Notes)under Sections 3(b)(vii) and 3(b)(viii) of each of the Notes and an Event of Default (as defined inthe Notes) under Section 11(a)(iii) of each of the Notes.     NOW, THEREFORE, in consideration of the agreements, provisions and covenants contained hereinand for other good and valuable consideration, the receipt and sufficiency of which are herebyacknowledged, each of the undersigned agrees as follows:     1. Company Alternative Conversion Notice.          a. For purposes of this Section 1, each capitalized term used herein, and not otherwisedefined, shall have the meaning ascribed thereto in the Notes.          b. The Company hereby elects to cause the conversion of an aggregate of $2,500,000 inprincipal amount (the “**Aggregate Conversion Amount**”) of the Notes (together with the aggregateInterest Amount with respect thereto), as if the Company had delivered a Company AlternativeConversion Notice pursuant to each of the Notes with respect thereto, and this Section 1(b) shallbe deemed a Company Alternative Conversion Notice pursuant to Section 8(a) of each of the Notes(which, for the avoidance of doubt, means each Note of each Series) and the conversion elected bythe foregoing shall be deemed a Company Alternative Conversion pursuant to Section 8 of each of theNotes (the “**August 2006 Company Conversion**”). The August 2006 Company Conversion elected by theCompany pursuant to this Section 1(b) shall be irrevocable by the Company. With respect to eachBuyer, its aggregate Pro Rata Conversion Amount of the Aggregate Conversion Amount shall be as setforth on Exhibit A attached hereto (such holder’s “**Aggregate Conversion Amount**”), and suchAggregate Conversion Amount shall apply on an aggregate basis to the Notes held by such Buyer.Each of the Buyers shall convert its Aggregate Pro Rata Conversion Amount with respect to the Notesheld by such Buyer, together with the Interest Amount with respect to the allocable portion of theprincipal represented by such Aggregate Pro Rata Conversion Amount accruing through and includingthe applicable Conversion Date, in accordance with, and subject to the terms and conditions ofSection 8 of each such Note (including the satisfaction (or waiver in writing by such Buyer) of theConditions to Company Alternative Conversion and the compliance with the provisions of Sections8(d) and 8(e) thereof), with such Buyer selecting the one or more Notes (of any one or more Series)held by such Buyer as to which the August 2006 Company Conversion shall apply.
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          c. Each of the Buyers, severally and not jointly, hereby waives, solely with respect to theAugust 2006 Company Conversion, the requirement that the Company AlternativeConversion Notice deemed to be delivered pursuant to Section 1(b) be delivered at least five(5) Business Days prior to the first Trading Day of the Company Alternative Conversion Period.Notwithstanding anything to the contrary in the Notes, each of the Buyers, severally and notjointly, hereby agrees with the Company that the Company Alternative Conversion Period with respectto the August 2006 Company Conversion shall be the period commencing on and including August 10,2006 through and including September 15, 2006.          d. In the event that any of a Buyer’s Aggregate Pro Rata Conversion Amount is not converted bysuch Buyer due to a failure to satisfy the Conditions to Company Alternative Conversion (unlesswaived in writing by such Buyer) or due to the provisions of Section 8(d) or 8(e) of the Notes(each, a “**Conversion Prohibition Event**”), then, notwithstanding anything to the contrary in theNotes, the August 2006 Company Conversion shall be null and void with respect to any suchunconverted Aggregate Pro Rata Conversion Amount, the Company shall be deemed to have given aCompany Alternative Redemption Notice with respect to such unconverted Aggregate Pro RataConversion Amount (and, for purposes of Section 7(a) of the Notes held by such Buyer, shall beentitled to give such Company Alternative Redemption Notice), and the principal represented by suchunconverted Aggregate Pro Rata Conversion Amount (together with the Interest Amount with respectthereto) shall be redeemed by the Company in accordance with the terms of this Amendment andSection 7 of the Notes by wire transfer of immediately available funds to such Buyer no later thanthe first Business Day following such Conversion Prohibition Event (an “**Unconverted Amount CompanyRedemption**”). Each of the Buyers, severally and not jointly, hereby waives, solely with respect tothe Unconverted Amount Company Redemption, (i) the requirement that the Company AlternativeRedemption Notice deemed to be delivered pursuant to this Section 1(d) be delivered at least five(5) Business Days prior to the Company Alternative Redemption Date, and (ii) the Conditions toCompany Alternative Redemption.     2. Amendment to the Notes.          a. Each of the Buyers, severally and not jointly, hereby agrees with the Company that each ofthe Notes held by such Buyer be amended by adding a new Section 6.1 thereto that shall read in itsentirety as follows:     “6.1 Installment Conversion or Redemption.     (a) Convertible Installment. With respect to each ConvertibleInstallment Date (as defined in Section 6.1(c)), the Company shall either (i)require conversion of the Convertible Installment Amount (as defined in Section6.1(c)), in whole or in part, in accordance with this Section 6.1 and Section 8 andthe corresponding sections of the Other Notes held by the Holder, at the applicableConversion Price, and subject to the satisfaction of the Conditions to CompanyAlternative Conversion (as defined in Section 8(c)) (a “**Convertible InstallmentConversion**”), or (ii) redeem the Convertible Installment Amount, in whole or inpart, in accordance with this Section 6.1 and Section 7 and the correspondingprovisions of the Other Notes held by the Holder (a “**Convertible InstallmentRedemption**”); provided that all of the outstanding Convertible Installment Amountmust be converted or redeemed by the Company, subject to
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the provisions of this Section 6.1 and the corresponding provisions of the OtherNotes held by the Holder; and provided further that the Company may elect more thanone of the Convertible Installment Conversion and the Convertible InstallmentRedemption, if each such election is with respect to at least $500,000 of theaggregate principal amount of the Notes comprising the aggregate ConvertibleInstallment Amount with respect to all of the Notes. At least five (5) BusinessDays prior to each Convertible Installment Date, the Company shall deliver to theHolder written notice (each a “**Convertible Installment Notice**”), which ConvertibleInstallment Notice shall state (i) the portion, if any, of the applicableConvertible Installment Amount which the Company elects to convert pursuant to aConvertible Installment Conversion (the “**Convertible Installment ConversionAmount**”), (ii) the portion, if any, of the applicable Convertible Installment Amountwhich the Company elects to redeem pursuant to a Convertible Installment Redemption(the “**Convertible Installment Redemption Amount**”), and which amount when added tothe Convertible Installment Conversion Amount must equal the Convertible InstallmentAmount, and (iii) if the Company has elected, in whole or in part, a ConvertibleInstallment Conversion, then the Convertible Installment Notice shall certify thatthe Conditions to Company Alternative Conversion are satisfied as of the date of theConvertible Installment Notice (except to the extent waived in writing by theHolder); provided that, notwithstanding anything to the contrary in Section 8, theCondition to Company Alternative Conversion set forth in Section 8(c)(iv) shall notapply to any Convertible Installment Conversion pursuant to this Section 6.1. Ifthe Company does not deliver a Convertible Installment Notice in accordance withthis Section 6.1(a) in connection with any Convertible Installment Date, then theConvertible Installment Redemption Amount shall mean the Convertible InstallmentAmount with respect to such Convertible Installment Date and the Company shall bedeemed to have given a Company Alternative Redemption Notice with respect to theConvertible Installment Amount (and, for purposes of Section 7(a), shall be entitledto give such Company Alternative Redemption Notice). Each Convertible InstallmentNotice shall be irrevocable. The Company shall elect to redeem and convert theConvertible Installment Amount of this Note pursuant to this Section 6.1(a) and thecorresponding Convertible Installment Amounts of the Other Notes pursuant to thecorresponding provisions of the Other Notes in the same ratio of principal amountbeing redeemed and principal amount being converted, and each holder shall elect theone or more Notes (of this or any other Series) held by such holder to which suchConvertible Installment Redemption and/or Convertible Installment Conversion shallapply. That portion of the Principal of this Note and the Other Notes held by theHolder constituting the Convertible Installment Conversion Amount shall be convertedin accordance with the provisions of this Section 6.1(a) and Sections 2 and 8 andthe corresponding provisions of the Other Notes held by the Holder at the applicableConversion Rate. That portion of the Principal of this Note and the Other Notesheld by the Holder constituting the Convertible Installment Redemption Amount(whether set forth in the Convertible Installment Notice or by operation of thisSection 6.1(a)) shall be redeemed in accordance with the provisions of this
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Section 6.1 and Section 7 at the applicable Company Alternative Redemption Rate.For purposes of this Section 6.1(a) and notwithstanding anything to the contrarycontained in Section 8(a), (A) a Convertible Installment Conversion shall constitutea Company Alternative Conversion; (B) a Convertible Installment Notice containing aConvertible Installment Conversion Amount shall constitute a Company AlternativeConversion Notice; (C) the Pro Rata Conversion Amount with respect to a ConvertibleInstallment Conversion shall be the Convertible Installment Conversion Amount; (D)the Company Alternative Conversion Period (as defined in Section 8(a)) with respectto a Convertible Installment Conversion shall be all of the Trading Days of themonth containing the applicable Convertible Installment Date; and (E) the “FinalCompany Alternative Conversion Date” shall be the final Trading Day of the monthcontaining the applicable Convertible Installment Date. For purposes of thisSection 6.1(a) and notwithstanding anything to the contrary contained in Section7(a), (V) a Convertible Installment Redemption shall constitute a CompanyAlternative Redemption; (W) a Convertible Installment Notice containing aConvertible Installment Redemption Amount shall constitute a Company AlternativeRedemption Notice; (X) the Company Alternative Redemption Date with respect to aConvertible Installment Redemption shall be the applicable Convertible InstallmentDate; (Y) the Pro Rata Redemption Amount with respect to a Convertible InstallmentRedemption shall be the Convertible Installment Redemption Amount; and (Z) theConditions to Company Alternative Redemption set forth in Section 7(c) shall bedeemed to have been satisfied.     (b) Cash Installment. With respect to each Cash Installment Date (asdefined in Section 6.1(c)), the Company shall be deemed to have given a CompanyAlternative Redemption Notice with respect to the Cash Redemption Amount (and, forpurposes of Section 7(a), shall be entitled to give such Company AlternativeRedemption Notice) and shall redeem the Cash Installment Amount (as defined inSection 6.1(c)) in accordance with this Section 6.1 and Section 7 and thecorresponding provisions of the Other Notes held by the Holder (a “**Cash InstallmentRedemption**”). Each holder shall elect the one or more Series of Notes held by suchholder to which such Cash Installment Redemption shall apply. That portion of thePrincipal of this Note and the Other Notes held by the Holder constituting the CashInstallment Amount shall be redeemed in accordance with the provisions of thisSection 6.1 and Section 7 and the corresponding provisions of the Other Notes heldby the Holder at the applicable Company Alternative Redemption Rate. For purposesof this Section 6.1(b) and notwithstanding anything to the contrary contained inSection 7(a), (i) a Cash Installment Redemption shall constitute a CompanyAlternative Redemption; (ii) the Company Alternative Redemption Date with respect toa Cash Installment Redemption shall be the applicable Cash Installment Date; (iii)the Pro Rata Redemption Amount with respect to a Cash Installment Redemption shallbe the Cash Installment Redemption Amount; and (iv) the Conditions to CompanyAlternative Redemption set forth in Section 7(c) shall be deemed to have beensatisfied.
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     (c) Definitions.          (i) For purposes of this Section 6.1, “**Cash Installment Amount**” means theportion of the Principal of this Note and the Other Notes held by the Holder equalto the lesser of (A) the product of $9,000,000, multiplied by the Holder’sAllocation Percentage, together with the Interest Amount with respect thereto, and(B) the aggregate outstanding Principal of all of the Notes held by the Holder,together with the Interest Amount with respect thereto.          (ii) For purposes of this Section 6.1, “**Cash Installment Date**” means each ofJanuary 15, 2007, April 15, 2007 and July 15, 2007, or if any such date is not aBusiness Day, the first Business Day thereafter.          (iii) For purposes of this Section 6.1, “**Convertible Installment Amount**” meansa portion of the Principal of this Note and the Other Notes held by the Holder equalto the lesser of (A) the product of $2,000,000, multiplied by the Holder’sAllocation Percentage, together with the Interest Amount with respect thereto, and(B) the aggregate outstanding Principal of all of the Notes held by the Holder,together with the Interest Amount with respect thereto.          (iv) For purposes of this Section 6.1, “**Convertible Installment Date**” means thefirst Business Day of each calendar month, beginning on and including October 1,2006 through and including June 1, 2007.”          b. Each of the Buyers, severally and not jointly, hereby agrees with the Company that Section8(b) of all of the Notes be amended by adding the phrase “, a Convertible Installment ConversionAmount” in the third sentence of such Section immediately following the phrase “MandatoryCompliance Amount”.          c. Each of the Buyers, severally and not jointly, hereby agrees with the Company that Section8(b) of all of the Notes be amended by adding the phrase “, a Convertible Installment Conversion”in the fourth sentence of such Section immediately following the phrase “Interest Conversion”.          d. Each of the Buyers, severally and not jointly, hereby agrees with the Company that Section8(d) of all of the Notes be amended by adding the phrase “, a Convertible Installment ConversionAmount” in the final sentence of such Section immediately following the phrase “MandatoryCompliance Amount”.          e. Each of the Buyers, severally and not jointly, hereby agrees with the Company that Section8(e) of all of the Notes be amended by adding the phrase “, a Convertible Installment ConversionAmount” in the final sentence of such Section immediately following the phrase “MandatoryCompliance Amount”.          f. Each of the Buyers, severally and not jointly, hereby agrees with the Company that thedefinition of Triggering Event set forth in Section 3(b)(viii) of each of the Notes be amended byadding the following at the end of such Section:
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“or Section 6.1 hereof, or the Company breaches or otherwise fails to comply withany representation, warranty, covenant or other term or condition of that certainAmendment and Waiver, dated as of August 9, 2006, by and among the Company, theBuyers and the Company’s Subsidiaries.”          g. The Notes, except as amended pursuant to this Section 2, shall remain unmodified, unamendedand in full force and effect. In the event of any conflict between the terms and provisions of theNotes and the terms and provisions of this Section 2, the terms and provisions of this Section 2shall prevail.     3. Amendment to the Warrants.          a. Each of the Buyers, severally and not jointly, hereby agrees with the Company that thedefinition of Warrant Exercise Price set forth in Section 1(b)(xv) of each of the Warrants beamended to read in its entirety as follows:“**Warrant Exercise Price”**shall be equal to, with respect to any Warrant Share $5.00,subject to adjustment and hereinafter provided.”          b. Each of the Buyers, severally and not jointly, hereby agrees with the Company that theamendment of the definition of Warrant Exercise Price as provided in Section 3(a) (the **“WarrantAmendment”**) shall be deemed for purposes of the second sentence of Section 8(a) of each of theWarrants to be an adjustment to the Warrant Exercise Price of the Warrants pursuant to the firstsentence of Section 8(a) thereof (i.e., as having resulted from an issuance or sale of shares ofCommon Stock for a consideration per share less than the Applicable Price in effect immediatelyprior to such issuance or sale), and that upon such deemed adjustment to the Warrant ExercisePrice, the number of Warrant Shares (as defined in such Warrant) acquirable upon exercise of suchWarrant shall be amended and adjusted in accordance with the provisions of the second sentence ofSection 8(a) of such Warrant (i.e., the number of shares of Common Stock acquirable upon exerciseof such Warrant shall be increased to the number of shares determined by multiplying the WarrantExercise Price of such Warrant in effect immediately prior to the Warrant Amendment by the numberof shares of Common Stock acquirable upon exercise of such Warrant immediately prior to the WarrantAmendment and dividing the product thereof by $5.00).          c. The Warrants, except as amended pursuant to this Section 3, shall remain unmodified,unamended and in full force and effect. In the event of any conflict between the terms andprovisions of the Warrants and the terms and provisions of this Section 3, the terms and provisionsof this Section 3 shall prevail.     4. Limited Waivers.          a. Subject to Section 4(c), each of the Buyers, severally and not jointly, hereby waives (i)the occurrence of a Triggering Event under Section 3(b)(vii) and (viii) of each of the Notes and anEvent of Default under Section 11(a)(iii) and (viii) of each of the Notes, the breach of Section 12of each of the Notes and the breach of Section 4(n) of the Securities Purchase Agreement resultingsolely from the Accounts Payable Default, and (ii) the Accounts Payable Default’s constituting afailure to satisfy any Condition to Company Alternative
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Conversion with respect to the August 2006 Company Conversion pursuant to this Amendment orany Convertible Installment Conversion pursuant to this Amendment and Section 6.1 of each of theNotes, as amended by this Amendment; provided that such waivers are subject to, and conditionedupon, (A) the aggregate outstanding amount of the O & G Accounts Payable not exceeding $12,500,000on the date of this Amendment and not having exceeded $13,500,000 at any time prior to the date ofthis Amendment, (B) the aggregate amount of the Accounts Payable unpaid in excess of 90 days beyondinvoice due date not exceeding $1,500,000 on the date of this Amendment and not having exceeded$1,500,000 at any time prior to the date of this Amendment, and (C) none of the Accounts Payablebeing unpaid in excess of 127 days beyond invoice due date on the date of this Amendment or havingbeen unpaid in excess of 162 days beyond invoice due date at any time prior to the date of thisAmendment; and provided, further, that the waivers contained in this Section 4(a) shall be null andvoid and of no force or effect, and there shall be an immediate breach of the Securities PurchaseAgreement and each of the Notes and a Triggering Event under each of the Notes, in the event that(V) the aggregate amount of the O & G Accounts Payable exceeds $12,500,000 at any time followingthe date of this Amendment, or (W) the aggregate amount of the O & G Accounts Payable exceeds$5,000,000 as of January 1, 2007 or at any time thereafter, (X) the aggregate amount of theAccounts Payable unpaid in excess of 90 days beyond invoice due date exceeds $2,500,000 at any timefollowing the date of this Amendment through (and including) September 15, 2006 or exceeds$1,500,000 at any time after September 15, 2006; (Y) any Accounts Payable are unpaid in excess of150 days beyond invoice due date at any time following the date of this Amendment or (Z) anyAccounts Payable are unpaid in excess of 90 days beyond invoice due date on December 31, 2006 or atany time thereafter.          b. Subject to Section 4(c), each of the Buyers, severally and not jointly, hereby waives (i)the occurrence of a Triggering Event (if any) under Section 3(b)(vii) of each of the Notes and anEvent of Default (if any) under Section 11(a)(viii) of each of the Notes, and the breach ofSections 2(f) and 4.5(a) of the Security Agreement, resulting solely from the Company’sestablishment of a Deposit Account (as defined in the Security Agreement) at Cornerstone Bank(**“Cornerstone”**) that is not subject to an Account Control Agreement (the **“Cornerstone DepositAccount”**), and deposit of $852,000 in Company funds therein, solely for purposes of securingreimbursement obligations under a letter of credit issued by Cornerstone Bank (such establishmentand deposit for such purposes being collectively referred to as the **“Cornerstone CollateralDeposit”**), and (ii) the Cornerstone Collateral Deposit’s constituting a failure to satisfy anyCondition to Company Alternative Conversion with respect to the August 2006 Company Conversationpursuant to this Amendment or any Convertible Installment Conversion pursuant to this Amendment andSection 6.1 of each of the Notes; provided that the waivers contained in this Section 4(b) shall benull and void and of no force and effect, and there shall be an immediate breach of the SecurityAgreement, in the event that (i) the aggregate funds in the Cornerstone Deposit Account at any timeexceed $852,000 or (ii) the Cornerstone Collateral Deposit would constitute a breach of Section 12of any of the Notes.          c. The limited waivers set forth in Sections 4(a) and 4(b) are conditioned upon, and subjectto, the Company’s performance of its commitments and obligations under this Amendment, the breachor non-performance of which shall render such waivers null and void and of no force and effect,each Buyer being entitled thereafter to exercise all remedies at law or in equity under theTransaction Documents as if Sections 4(a) and 4(b) had not been part of this
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Amendment, as executed. The limited waivers set forth in Sections 4(a) and 4(b) are not, andshall not be deemed to be, a waiver under any other circumstance or a waiver of any othercondition, requirement, provision or breach of any of the Transaction Documents or any otheragreement or instrument.     5. Additional Note Issuance Prohibition. The Company hereby agrees with each of theBuyers, severally and not jointly, that as of and after the date of this Amendment, the Companyshall not have the right to sell any Additional Notes or Additional Warrants to the Buyers pursuantto Section 1(b) of the Securities Purchase Agreement, and any Additional Sale Election Noticedelivered pursuant thereto as of and after the date of this Amendment shall be null and void and ofno force or effect.     6. Company Alternative Conversion Limitation. The Company hereby agrees with each ofthe Buyers, severally and not jointly, that as of and after the date of this Amendment, (a) theCompany shall not have the right to effect any Company Alternative Conversion pursuant to Section 8of the Notes other than pursuant to the August 2006 Company Conversion in accordance with thisAmendment or a Convertible Installment Conversion (as defined in Section 6.1 of the Notes, asamended by this Amendment) in accordance with this Amendment and Section 6.1 of the Notes, asamended by this Amendment, and (b) any Company Alternative Conversion Notice delivered pursuant toany of the Notes (other than a Company Alternative Conversion Notice with respect to the August2006 Company Conversion deemed delivered pursuant to Section 1(b) of this Amendment or a CompanyAlternative Conversion Notice deemed delivered pursuant to Section 6.1 of any of the Notes, asamended by this Amendment) as of and after the date of this Amendment shall be null and void and ofno force or effect.     7. Covenants.          a. Prior to 9:00 a.m., New York time, on August 10, 2006, but in no event no later than theearlier of (i) the filing by the Company of its Quarterly Report on Form 10-Q for the quarter endedJune 30, 2006 (the “**Form 10-Q**”) or (ii) the issuance by the Company of a press release disclosingthe Company’s operating results with respect to the quarter ended June 30, 2006, the Company shallfile a Form 8-K or the Form 10-Q (the “**Amendment SEC Filing**”) with the Securities and ExchangeCommission (the “**SEC**”) describing the terms of this Amendment, any information reasonably requestedto be disclosed therein by any Buyer and any material non-public information previously provided bythe Company, any of its Subsidiaries or any of their respective officers, directors, employees oragents to any of the Buyers and not subsequently disclosed on a Form 8-K or otherpublicly-available filing with the SEC prior to the filing of the Amendment SEC Filing, andincluding as an exhibit to such Amendment SEC Filing this Amendment, all in the form required bythe 1934 Act. The Company shall provide each Buyer with a reasonably opportunity to review andcomment upon such disclosure prior to the filing of the Amendment SEC Filing with the SEC. TheCompany hereby represents and warrants to each of the Buyers that, from and after the filing of theAmendment SEC Filing with the SEC, no Buyer shall be in possession of any material nonpublicinformation received from the Company, any of its Subsidiaries or any of their respective officers,directors, employees or agents.
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          b. Within two (2) Business Days following the execution of this Amendment by the Company andthe Buyers, the Company shall promptly reimburse each Buyer for all of the out-of-pocket fees,costs and expenses (including, but not limited to, attorneys’ fees, costs and expenses) incurred bysuch Buyer in connection with the negotiation and documentation of this Amendment. Following thedate hereof, the Company shall promptly reimburse each Buyer for all of the out-of-pocket fees,costs and expenses (including, without limitation, attorneys’ fees, costs and expenses) incurred bysuch Buyer in connection with any amendment, modification or waiver of any of the TransactionDocuments and/or the enforcement of such Buyer’s rights and remedies under any of the TransactionDocuments.     8. Representations and Warranties of the Company. The Company represents and warrantsto each of the Buyers that:          a. *Authorization; Enforcement; Validity*. Each of the Company and its Subsidiaries has therequisite corporate power and authority to enter into and perform its obligations under thisAmendment, the Notes, as amended hereby, and the Warrants, as amended hereby. The execution anddelivery of this Amendment by each of the Company and its Subsidiaries and the consummation of thetransactions contemplated hereby (including the issuance of the Conversion Shares upon conversionof the Notes (as amended hereby) and the issuance of Warrant Shares upon the issuance of theWarrants (as amended hereby)) have been duly authorized by the respective boards of directors ofthe Company and its Subsidiaries, and no further consent or authorization is required of any of theCompany, its Subsidiaries or their respective Boards of Directors or shareholders (under applicablelaw, the rules and regulations of the Principal Market or otherwise). This Amendment has been dulyexecuted and delivered by each of the Company and its Subsidiaries, and each of this Amendment, theNotes (as amended hereby) and the Warrants (as amended hereby) constitutes a valid and bindingobligation of each of the Company and its Subsidiaries, enforceable against each of the Company andits Subsidiaries in accordance with its terms.          b. *Issuance of Securities*. Upon issuance in accordance with the Notes (as amended hereby) andthe Warrants (as amended hereby), the Conversion Shares and the Warrant Shares will be validlyissued, fully paid and nonassessable and free from all taxes and Liens with respect to the issuethereof, with the holders being entitled to all rights accorded to a holder of the Common Stock.          c. *No Conflicts*. The execution and delivery of this Amendment by each of the Company and itsSubsidiaries, the performance by each of the Company and its Subsidiaries of its obligationshereunder and the consummation by each of the Company and its Subsidiaries of the transactionscontemplated hereby and by the Notes (as amended hereby) and the Warrants (as amended hereby) willnot (i) result in a violation of the Articles of Incorporation or the Bylaws or the organizationaldocuments of any Subsidiary; (ii) conflict with, or constitute a breach or default (or an eventwhich, with the giving of notice or lapse of time or both, constitutes or would constitute a breachor default) under, or give to others any right of termination, amendment, acceleration orcancellation of, or other remedy with respect to, any agreement, indenture or instrument to whichthe Company or any of its Subsidiaries is a party; or (iii) result in a violation of any law,rule, regulation, order, judgment or decree (including federal and state securities laws andregulations and the rules and regulations of the Principal Market)
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applicable to the Company or any of its Subsidiaries or by which any property or asset of theCompany or any of its Subsidiaries is bound or affected. None of the Company nor any of itsSubsidiaries is required to obtain any consent, authorization or order of, or make any filing orregistration with, any court or governmental agency, the Principal Market or any other regulatoryor self-regulatory authority in order for it to execute, deliver or perform any of its obligationsunder or contemplated by this Amendment in accordance with the terms hereof, or under the Notes (asamended hereby) or the Warrants (as mended hereby), including, the issuance of the ConversionShares and the Warrant Shares in accordance with the terms of the Notes (as amended hereby) and theWarrants (as amended hereby).          d. *No Default*. Other than the Accounts Payable Default, there exists no Triggering Event,Event of Default or breach or failure to comply by the Company or any of its Subsidiaries with anyrepresentation, warranty, covenant or other term or condition of any of the Transaction Documents,or an event which, with the giving of notice or lapse of time or both and without being cured,constitutes or would constitute such a Triggering Event, Event of Default or breach or failure.     9. Representation and Warranties of the Buyers. Each of the Buyers represents andwarrants to the Company that (a) such Buyer is a validly existing corporation, partnership, limitedliability company or other entity and has the requisite corporate, partnership, limited liabilityor other organizational power and authority to enter into and perform its obligations under thisAmendment, and (b) this Amendment has been duly and validly authorized, executed and delivered onbehalf of such Buyer and is a valid and binding agreement of such Buyer enforceable against suchBuyer in accordance with its terms.     10. Avoidance of Doubt. The parties hereto hereby agree, for the avoidance of doubt,that the terms “Notes” and “Warrants” as used in the Transaction Documents shall mean the Notes andthe Warrants as amended by this Amendment, and each of the parties hereto agrees not to take anycontrary positions.     11. Independent Nature of the Buyers. The obligations of each of the Buyers hereunderare several and not joint with the obligations of the other, and none of the Buyers shall beresponsible in any way for the performance of the obligations of any of the other Buyers hereunderor under any of the Transaction Documents. Each of the Buyers shall be responsible only for itsown agreements and covenants hereunder and under the Transaction Documents. The decision of eachof the Buyers to enter into this Amendment has been made by such party independently of any of theother Buyers and independently of any information, materials, statements or opinions as to thebusiness, affairs, operations, assets, properties, liabilities, results of operations, condition(financial or otherwise) or prospects of the Company or any of its Subsidiaries which may have beenmade or given by any of the other Buyers or by any agent or employee of any of the other Buyers,and none of the Buyers nor any of their respective agents or employees shall have any liability toany of the other Buyers (or any other person or entity) relating to or arising from any suchinformation, materials, statements or opinions. Nothing contained herein or in any of theTransaction Documents, and no action taken by any of the Buyers pursuant hereto or thereto, shallbe deemed to constitute any of the Buyers as a partnership, an association, a joint venture or anyother kind of entity, or create a presumption that any of the Buyers are in any way acting inconcert or as a group with respect to such
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obligations or the transactions contemplated hereby or thereby. Each of the Buyers shall beentitled to independently protect and enforce its rights, including the rights arising out of thisAmendment, the Notes, the Warrants and the other Transaction Documents, and it shall not benecessary for any of the other Buyers to be joined as an additional party in any proceeding forsuch purpose.     12. Successors and Assigns. This Amendment shall be binding upon and shall inure tothe benefit of the parties hereto and their respective successors and permitted assigns. Thesuccessors and assigns of such entities shall include their respective receivers, trustees ordebtors-in-possession.     13. Further Assurances. The Company hereby agrees from time to time, as and whenrequested by any Buyer, to execute and deliver or cause to be executed and delivered, all suchdocuments, instruments and agreements, including financing statements, secretary’s certificates,stock powers and irrevocable transfer agent instructions, and to take or cause to be taken suchfurther or other action, as such Buyer may reasonably deem necessary or desirable in order to carryout the intent and purposes of this Amendment and the Transaction Documents.     14. Rules of Construction. All words in the singular or plural include the singularand plural and pronouns stated in either the masculine, the feminine or neuter gender shall includethe masculine, feminine and neuter, and the use of the word “including” in this Amendment shall beby way of example rather than limitation.     15. Governing Law; Jurisdiction; July Trial. All questions concerning theconstruction, validity, enforcement and interpretation of this Amendment shall be governed by theinternal laws of the State of New York, without giving effect to any choice of law or conflict oflaw provision or rule (whether of the State of New York or any other jurisdiction) that would causethe application of the laws of any jurisdiction other than the State of New York. Each partyhereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting inthe City of New York, borough of Manhattan, for the adjudication of any dispute hereunder or inconnection herewith or with any transaction contemplated hereby or discussed herein, and herebyirrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that itis not personally subject to the jurisdiction of any such court, that such suit, action orproceeding is brought in an inconvenient forum or that the venue of such suit, action or proceedingis improper. Each party hereby irrevocably waives personal service of process and consents toprocess being served in any such suit, action or proceeding by mailing a copy thereof to such partyat the address for such notices to it under this Amendment and agrees that such service shallconstitute good and sufficient service of process and notice thereof. Nothing contained hereinshall be deemed to limit in any way any right to serve process in any manner permitted by law.EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIALFOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THISAMENDMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
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     16. Severability. Wherever possible, each provision of this Amendment shall beinterpreted in such manner as to be effective and valid under applicable law, but if any provisionof this Amendment shall be prohibited by or invalid under such law, such provision shall beineffective to the extent of such prohibition or invalidity without invalidating the remainder ofsuch provision or the remaining provisions of this Amendment.     17. Merger. This Amendment and the Transaction Documents, as amended hereby,represent the final agreement of each of the parties hereto with respect to the matters containedherein and may not be contradicted by evidence of prior or contemporaneous agreements, or prior orsubsequent oral agreements, among any of the parties hereto.     18. Execution in Counterparts. This Amendment may be executed in two or moreidentical counterparts, all of which shall be considered one and the same agreement and shallbecome effective when counterparts have been signed by each party and delivered to each otherparty. In the event that any signature to this Amendment or any amendment hereto is delivered byfacsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shallcreate a valid and binding obligation of the party executing (or on whose behalf such signature isexecuted) with the same force and effect as if such facsimile or “.pdf” signature page were anoriginal thereof. No party hereto shall raise the use of a facsimile machine or e-mail delivery ofa “.pdf” format data file to deliver a signature to this Amendment or any amendment hereto or thefact that such signature was transmitted or communicated through the use of a facsimile machine ore-mail delivery of a “.pdf” format data file as a defense to the formation or enforceability of acontract, and each party hereto forever waives any such defense.     19. Section Headings. The section headings herein are for convenience of referenceonly, and shall not affect in any way the interpretation of any of the provisions hereof.     20. No Strict Construction. The language used in this Amendment will be deemed to bethe language chosen by the parties to express their mutual intent, and no rules of strictconstruction will be applied against any party.     21. Ratification by Guarantors. By execution hereof, each of the Subsidiaries herebyacknowledges and agrees that it has reviewed this Amendment and hereby ratifies and confirms itsrespective obligations under the Transaction Documents, in each case as amended hereby.**[Remainder of page intentionally left blank; Signature page follows]**
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     IN WITNESS WHEREOF, this Amendment has been duly executed by each of the undersigned as of theday and year first set forth above.       **INFINITY ENERGY RESOURCES, INC.**       By: /s/ J.A. Tuell       Name: J.A. Tuell       Title: President and CEO            **CONSOLIDATED OIL WELL SERVICES, INC.**       By: /s/ Timothy A. Ficker       Name: Timothy A. Ficker       Title: Vice President, CFO            **CIS-OKLAHOMA, INC.**       By: /s/ Stanton E. Ross       Name: Stanton E. Ross       Title: President            **INFINITY OIL & GAS OF WYOMING, INC.**       By: /s/ J.A. Tuell       Name: J.A. Tuell       Title: President            **INFINITY OIL & GAS OF KANSAS, INC.**       By: /s/ J.A. Tuell       Name: J.A. Tuell       Title: President            **INFINITY OIL AND GAS OF TEXAS, INC.**       By: /s/ J.A. Tuell       Name: J.A. Tuell       Title: President     
 

 
         **HFTP INVESTMENT L.L.C.**         By: Promethean Asset Management L.L.C.  Its: Investment Manager           By: /s/ Robert J. Brantman           Name: Robert J. Brantman    Title: Partner and Authorized Signatory         **GAIA OFFSHORE MASTER FUND, LTD.**         By: Promethean Asset Management L.L.C.  Its: Investment Manager           By: /s/ Robert J. Brantman           Name: Robert J. Brantman    Title: Partner and Authorized Signatory
 

 
           **AG OFFSHORE CONVERTIBLES, LTD.**           By: Angelo, Gordon & Co. L.P.  Its: Director             By: /s/ Michael L. Gordon           Name: Michael L. Gordon           Title: Chief Operating Officer                  **LEONARDO, L.P.**           By: Leonardo Capital Management, Inc.  Its: General Partner             By: Angelo, Gordon & Co., L.P.    Its: Director               By: /s/ Michael L. Gordon               Name: Michael L. Gordon               Title: Chief Operating Officer         
 

 
         **PORTSIDE GROWTH & OPPORTUNITY FUND**         By:           Its:                    By: /s/ Jeffrey C. Smith           Name: Jeffrey C. Smith           Title: Authorized Signatory       
 

 
**Exhibit A**August 2006 Company Conversion     **Buyer** **Aggregate Pro Rata Conversion Amount**HFTP Investment L.L.C. $934,437.16 Gaia Offshore Master Fund, Ltd. $315,562.84 AG Offshore Convertibles, Ltd. $519,736.84 Leonardo, L.P. $205,263.16 Portside Growth & Opportunity Fund $525,000.00