ESCROW AGREEMENT



            THIS ESCROW AGREEMENT (this "Agreement") is made as of November 20,

2000, by and among Infinite Group, Inc., a corporation incorporated under the

laws of the State of Delaware, (the "Company"), Cockfield Holdings Limited, a

British Virgin Islands corporation ("Investor"), and Epstein Becker & Green,

P.C., (the "Escrow Agent"). Capitalized terms used but not defined herein shall

have the meanings set forth in the Private Equity Line of Credit Agreement

referred to in the first recital.



                              W I T N E S S E T H:



            WHEREAS, the Investor will from time to time as requested by the

Company, purchase shares of the Company's Common Stock from the Company as set

forth in that certain Private Equity Line of Credit Agreement (the "Purchase

Agreement") dated the date hereof between the Investor and the Company, which

will be issued as per the terms and conditions contained herein and in the

Purchase Agreement; and



            WHEREAS, the Company and the Investor have requested that the Escrow

Agent hold in escrow and then distribute the initial documents and certain funds

which are conditions precedent to the effectiveness of the Purchase Agreement,

and have further requested that upon each exercise of a Put, the Escrow Agent

hold the relevant documents and the applicable purchase price pending receipt by

the Investor of certificates representing the securities issuable upon such Put;



            NOW, THEREFORE, in consideration of the covenants and mutual

promises contained herein and other good and valuable consideration, the receipt

and legal sufficiency of which are hereby acknowledged and intending to be

legally bound hereby, the parties agree as follows:



                                   ARTICLE 1



                   TERMS OF THE ESCROW FOR THE INITIAL CLOSING



            1.1. The parties hereby agree to establish an escrow account with

the Escrow Agent whereby the Escrow Agent shall hold the funds and documents

which are referenced in Section 7.2 of the Purchase Agreement.



            1.2. At the Initial Closing, the Company shall deliver to the Escrow

Agent:



                        (i)   the initial original Initial Warrant certificate

                              in the form of Exhibit D to the Purchase

                              Agreement;



                        (ii)  the original executed Registration Rights

                              Agreement in the form of Exhibit C to the Purchase

                              Agreement;



<PAGE>



                        (iii) the original executed opinion of Morse, Zelnick,

                              Rose & Lander, LLP, counsel of the Company, in the

                              form of Exhibit E to the Purchase Agreement;



                        (iv)  the sum of $15,000;



                        (v)   a warrant certificate to purchase up to 100,000

                              shares of Common Stock issued to Jesup and Lamont

                              Securities Corporation otherwise identical in form

                              to that of the Warrant (the "J&L Warrant");



                        (vi)  the original executed Company counterpart of this

                              Escrow Agreement; and



                        (vii) the original executed Company counterpart of the

                              Purchase Agreement.



            1.3. Upon receipt of the foregoing, and receipt of executed

counterparts from Investor of the Purchase Agreement, the Registration Rights

Agreement and this Escrow Agreement, the Escrow Agent shall calculate the

exercise price of the Initial Warrant and the J&L Warrant and enter the exercise

price, the commencement date and termination date of such warrants on the faces

thereof and immediately transfer the sum of Fifteen Thousand Dollars ($15,000)

to Epstein Becker & Green, P.C. ("EB&G"), 250 Park Avenue, New York, New York

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