UNITED STATES SECURITIES AND EXCHANGE COMMISSIONWashington,
D.C. 20549




FORM 10-K/AAMENDMENT
NO. 2




(Mark
One) [X]   ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




For the fiscal year
ended December 31, 2009




OR




[_]  
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934




For the transition
period from __________________ to __________________




Commission File
Number 0-20943




Intelligroup,
      Inc.(Exact name of registrant as specified
      in its charter)


New Jersey
            
            11-2880025(State or other jurisdiction of
      incorporation or
            
            (I.R.S. Employer Identification
      No.)organization)5 Independence Way,
      Suite 220, Princeton, NJ 08540
            
            (646)
    810-7400(Address of principal executive offices
      including zip code)
            
            (Registrant's telephone number,
      including area code)


Securities registered
pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section
12(g) of the Act: Common Stock, $0.01 par value




Indicate by check
mark if the registrant is a well-known seasoned issuer, as defined in Rule 405
of the Securities Act. Yes o No þ




Indicate by check
mark if the registrant is not required to file reports pursuant to Section 13 or
Section 15(d) of the Exchange Act. Yes o No þ




Indicate by check
mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes þ No o




Indicate by check
mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
is not contained herein, and will not be contained, to the best of the
registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. o




Indicate by check
mark whether the registrant is a large accelerated filer, an accelerated filer,
a non-accelerated filer or a smaller reporting company. See definition of "large
accelerated filer,” “accelerated filer " and "smaller reporting company" in Rule
12b-2 of the Exchange Act. (Check one):




Large
      accelerated filero
            Accelerated filero
            Non-accelerated filero
            Smaller
      Reporting Companyþ(Do not check if a smaller
      reporting company)  Indicate by check
mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). Yes o No þ
  The aggregate market
value of the voting stock held by non-affiliates of the registrant as of June
30, 2009 (the last business day of the most recent second quarter) was
$23,595,943 (based on the closing price as quoted on Nasdaq on that date). For
purposes of this calculation, shares owned by officers, directors and 10%
shareholders known to the registrant have been deemed to be owned by affiliates.
This determination of affiliate status is not a determination for other
purposes.
  Indicate the number
of shares outstanding of each of the registrant's classes of common stock, as of
April 28, 2010:
  Class
            
            
            Number of
    SharesCommon Stock, $0.01 par value
            
            41,249,688




Explanatory Note




This Amendment No. 1
on Form 10-K/A (the “Form 10/KA”) to the Annual Report on Form 10-K (the “Annual
Report”) of the Company for the fiscal year ended December 31, 2009, filed with
the Securities and Exchange Commission (the “SEC”) on March 30, 2010, is filed
solely for the purpose of including information that was to be incorporated by
reference from the Company’s definitive proxy statement pursuant to Regulation
14A of the Securities Exchange Act of 1934. The Company will not file its proxy
statement for its annual meeting of stockholders within 120 days of its fiscal
year ended December 31, 2009, and is therefore amending and restating in their
entirety Items 10, 11, 12, 13 and 14 of Part III of the Annual Report. In
addition, pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934,
the Company is including with this Form 10-K/A certain currently dated
certifications. Except as described above, no other amendments are being made to
the Annual Report. This Form 10-K/A does not reflect events occurring after the
filing of the Annual Report on March 30, 2010 or modify or update the disclosure
contained in the Annual Report in any way other than as required to reflect the
amendments discussed above and reflected below.




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PART III




Item 10. Directors, Executive Officers and
Corporate Governance.




Biographical Summaries of Our Members of Board
of Directors




The members of the
Board of Directors (each a "Director and collectively, "Directors") are:




Served as
      aDirectorName
            
            Age
            
            Since
            
            Positions with the
      CompanyVikram Gulati
            
            44
            
            2005
            
            President, Chief Executive Officer
      andDirectorRavi Adusumalli
            
            34
            
            2004
            
            DirectorSrinivasa Raju
            
            48
            
            2004
            
            Director, Chairman of the BoardSandeep Reddy
            
            41
            
            2004
            
            Director


The following biographical descriptions set
forth certain information with respect to the Director Nominees, based on
information furnished to Intelligroup by each Director Nominee.




Vikram Gulati. Vikram Gulati was appointed to the Board of Directors and to the
positions of President and Chief Executive Officer effective April 4, 2005.
Prior to joining the Company, Mr. Gulati held a number of positions in business
development and business management with Wipro Limited (“Wipro”) from 1988
through 2005. Mr. Gulati most recently served as the head of Wipro’s Global
Enterprise Application Solutions Group. We believe that Mr. Gulati's extensive
knowledge of the Company's operations, competitive challenges and opportunities
gained through his position as President and Chief Executive Officer as well as
his over twenty years of experience in the information technology consulting and
outsourcing industry qualify him to serve on our board of directors.




Ravi Adusumalli. Ravi Adusumalli was initially appointed to the Board of Directors of the
Company in September 2004 in accordance with the terms of the Common Stock
Purchase Agreement dated September 29, 2004 by and between the Company, SB Asia
Infrastructure Fund LP, and Venture Tech Assets Ltd., which allowed SB Asia
Infrastructure Fund LP and Venture Tech Assets Ltd. to collectively designate
five directors to the Company’s Board of Directors. Mr. Adusumalli joined
Softbank Asia Infrastructure Fund (SAIF) in early 2002 and is currently a
General Partner and Head of SAIF’s India Operations. Prior to joining SAIF, Mr.
Adusumalli was an Associate Partner with Mobius Venture Capital, a $1.25 billion
early stage venture capital firm in Silicon Valley. He previously worked at
Credit Suisse First Boston as an Associate and with Wasatch Funds, a mutual fund
with over $9 billion in assets that specialized in small cap and micro cap companies listed on US and international
exchanges. Mr. Adusumalli graduated from Cornell University with a Bachelors of
Arts in Economics and Government. Mr. Adusumalli serves on the board of
directors of SAIF’s investments in National Stock Exchange, MakeMyTrip,
HomeShop18, One97 Communications, JustDial, Mainland China and Intelligroup. We
believe that Mr. Adusumalli is qualified to serve on our board of directors due
to his senior position at SAIF, his experience managing other India-based
portfolio companies in the information technology industry and his extensive
investment and finance experience.




---



Srinivasa Raju. Srinivasa Raju was initially appointed to the Board of Directors of the
Company in September 2004 in accordance with the terms of the Common Stock
Purchase Agreement dated September 29, 2004 by and between the Company, SB Asia
Infrastructure Fund LP, and Venture Tech Assets Ltd., which allowed SB Asia
Infrastructure Fund LP and Venture Tech Assets Ltd. to collectively designate
five directors to the Company's Board of Directors. Presently Mr. Srini Raju is
the Managing Director and General Partner of Peepul Capital Advisors. Peepul
Capital manages over USD 400 millions of Institutional and General Partners
Capital across two funds. Peepul Capital Limited Partners (LP) include some of
the most reputed international funds: IFC, Sovereign Funds, Pension Funds,
Endowments and Global Business Family Offices. Mr. Raju was also the founding
Chief Executive Officer and Managing Director of Satyam Enterprise Solutions P
Ltd from 1997. After the merger of SES with SCS in 1999, Mr. Raju left Satyam
and founded iLabs Venture Capital Fund (predecessor to Peepul Capital). Mr. Raju
held the position of Chief Executive Officer and Managing Director of Dun &
Bradstreet Satyam Software P Ltd. (now known as Cognizant Technology Solutions).
Mr. Raju graduated with Honors from NIT (R.E.C), Kurukshetra with a Bachelor of
Science in Civil Engineering and from Utah State University with a Master's
degree in Civil & Environmental Engineering. Mr. Raju is a member of the
governing board of (ISB) the Indian School of Business and sponsor of the Srini
Raju Center for IT and Networked Economy (CITNE) at ISB. In addition, Mr. Raju
also is a founding member, major donor and active member of the Governing
Council of IIIT, Hyderabad, established on public-private partnership model by
leading technology companies and has become India's leading Technology Research
University over the past 10 years. Mr. Raju previously served on the board of
directors of Sify Ltd. within the past five years. We believe that Mr. Raju has
the necessary qualifications and experience to serve as the Company's Chairman
of the Board based on his extensive leadership and management positions within
the information technology consulting and outsourcing industry, including his
experience as the founding CEO of Cognizant Technology Solutions; his extensive
investment and investment advisory experience; and his extensive experience
managing Peepul Capital's portfolio companies within the information technology
sector.




Sandeep Reddy. Mr.
Reddy was initially appointed to the Board of Directors of the Company in
September 2004 in accordance with the terms of the Common Stock Purchase
Agreement dated September 29, 2004 by and between the Company, SB Asia
Infrastructure Fund LP, and Venture Tech Assets Ltd., which allowed SB Asia
Infrastructure Fund LP and Venture Tech Assets Ltd. to collectively designate
five directors to the Company’s Board of Directors. Mr. Reddy currently serves
as Managing Director of Peepul Capital Management LLC, which was formerly known
as iLabs Management, LLC, a fund management company. From 2000 to 2006, Mr.
Reddy served as Vice Chairman of iLabs, a private venture capital fund which
invested in the domains of intellectual property in life sciences,
telecommunications and technology based products and services. Mr. Reddy
previously served on the board of directors of Sify Ltd. within the past five
years. We believe that Mr. Reddy has the necessary qualifications and experience
to serve on the board of directors based on his extensive investment experience
and his extensive leadership and management experience, including managing iLab's and Peepul Capital's other
portfolio companies within the information technology sector.




All Directors hold office until the next
Annual Meeting of Shareholders and until their successors are duly elected and
qualified.




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Family Relationships




There are no family relationships
among our Director Nominees, management and other key personnel.




Director Qualifications




We believe that the Company and its
shareholders are best served by having leadership personnel from our principal
stockholders and individuals who have extensive experience in the Company’s
industry and knowledge of the Company’s competitive landscape serve on our board
of directors. We also believe that the backgrounds and qualifications of our
directors, considered as a group, should provide a composite mix of experience,
knowledge and abilities that will allow the board of directors to fulfill its
responsibilities. We select directors who have the highest personal and
professional ethics, integrity and values; practical wisdom and mature judgment;
an inquisitive and objective perspective; the willingness to engage management
and each other in a constructive and collaborative fashion; and a commitment to
representing the long-term interests of all our shareholders. In addition,
directors must be willing to devote sufficient time to carrying out their duties
and responsibilities effectively and should be committed to serving on the Board
for an extended period of time. Please refer to the biographies of each of
directors for a discussion of the specific experience, qualifications,
attributes or skills that led to the conclusion that each individual should
serve as a director.




Biographical Summaries of Executive
Officers




The following table identifies our
executive officers




In CurrentName
            
            Age
            
            Capacities in Which
    Served
            
            Position SinceVikram Gulati(1)
            
            44
            
            President and Chief Executive
      Officer
            
            2005Alok Bajpai(2)
            
            44
            
            Chief Financial Officer and
      Treasurer
            
            2006Kalyan
            
            44
            
            Chief Operating Officer, Intelligroup
      Asia
            
            2007SundaramMahalingam(3)Pankit Desai(4)
            
            40
            
            Senior Vice President of Sales, North
      America
            
            2009and Europe


(1)
            
            Vikram Gulati
      has been President and Chief Executive Officer and a director of
      Intelligroup since April 2005. His complete biography is set forth above
      under the caption “Nominees for
Election.”


---



(2)
            
            Alok Bajpai is
      a rank holder Chartered Accountant from India, Certified Public Accountant
      from the US and a Management Graduate from Manchester Business School, UK.
      Prior to Intelligroup, Mr. Bajpai served as Associate Vice President,
      F&A at Infosys Limited from May 2004 to September 2006 and managed
      their global accounts function. Prior to Infosys, from 1999 to 2004, Mr.
      Bajpai worked at Port Fish Private Limited, a Canadian company, as their
      Controller. He started his career with HCL in 1988 and worked with ICIM
      and Pepsico Restaurants in India before moving to Nigeria to work with a
      Belgian organization. Mr. Bajpai then moved to Canada and worked as Head
      of Finance at the aforementioned Canadian company for about 5 years. In
      these various organizations Mr. Bajpai has been in senior management
      positions and has played operational, as well as, strategic
      roles.(3)
            
            Mr. Kalyan
      Sundaram Mahalingam joined Intelligroup Asia in March 2007. He was
      promoted to Chief Operating Officer, Intelligroup Asia on July 1, 2007.
      Prior to Intelligroup, from March 2006 to March 2007, Mr. Mahalingam
      served as Vice President - GRM and Enterprise Application Services
      Practice at Keane, Inc. From May 1993 through February 2006, Mr.
      Mahalingam was employed by Wipro Technologies in several positions; most
      recently he was General Manager, Enterprise Applications Services. He has
      held many positions in practice building, delivery, quality and key
      positions in finance. He holds a Bachelor of Commerce from Bharathiyar
      University, Coimbatore, India and a Chartered Accountancy from the
      Institute of Chartered Accountants of India in New
  Delhi.(4)
            
            Mr. Desai
      joined Intelligroup in December 2005. Effective January 1, 2009 he took
      over responsibility as Senior Vice President, Sales for North America and
      Europe. Prior to joining Intelligroup, Mr. Desai was with Wipro
      Technologies from November 2000 to December 2005 where he managed
      strategic accounts and the southwest region of the US. Before Wipro he
      worked with IBM as a country manager for the AS/400 product group,
      Cognizant Technologies and CMC Limited. Mr. Desai has a Bachelor’s in
      Engineering and MBA from India.




None of our executive officers is related to
any other executive officer or to any of our Directors. Our executive officers
are elected annually by the Board of Directors and serve until their successors
are duly elected and qualified.




Section 16(a) Beneficial Ownership Reporting
Compliance




Section 16(a) of the Securities Exchange Act
of 1934, as amended, requires our officers, directors and persons who are the
beneficial owners of more than 10% of our common stock to file with the
Securities and Exchange Commission (the "SEC") initial reports of ownership and
reports of changes in ownership of our common stock. Officers, directors and
beneficial owners of more than 10% of our common stock are required by SEC
regulations to furnish us with copies of all Section 16(a) forms they file.
Except as set forth below, based solely on a review of the copies of the Forms
3, 4 and 5 and amendments that we received with respect to transactions during
2009, we believe that all such forms were filed on a timely basis.




Mr. Desai filed a Form 4 on September 21,
2009. Such Form 4 should have been filed no later than September 16, 2009.




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Director Independence




Our common stock is not listed on a national
securities exchange and therefore we are not subject to any corporate governance
requirements regarding independence of board or committee members. However, we
have chosen the definition of independence contained in the NASDAQ rules as
benchmark to evaluate the independence of our directors. Under NASDAQ rules, a
director will only qualify as an “independent director” if, in the opinion of
our Board of Directors, that person does not have a relationship which would
interfere with the exercise of independent judgment in carrying out the
responsibilities of a Director. Our Board of Directors has determined that none
of our directors qualify as an “independent director” as defined under Rule
4200(a)(15) of the NASDAQ Stock Market, Inc. Marketplace Rules.




Audit Committee




The Board of Directors has established a
separately designated standing audit committee (the "Audit Committee"). The
Audit Committee is responsible for:


- appointing, approving the
  compensation of, and assessing the independence of, our independent registered public accounting
  firm;
- overseeing the work of our
  independent registered public accounting firm, including through the receipt and consideration of
  certain reports from the independent registered public accounting firm;
- reviewing and discussing with
  management and the independent registered public accounting firm our annual and quarterly
  financial statements and related disclosures;
- monitoring our internal control
  over financial reporting, disclosure controls and procedures and code of business conduct and
  ethics;
- discussing and assessing our risk
  management policies;
- establishing policies regarding
  hiring employees from the independent registered public accounting firm and procedures for the
  receipt and retention of accounting related complaints and concerns;
- meeting independently with our
  independent registered public accounting firm and management; and
- preparing the audit committee
  report required by SEC rules.

---



Because our common stock is not currently
listed on a national securities exchange, we are not subject to the listing
standards for audit committees set forth in SEC Rule 10A-3. We do not have three
independent directors on the Audit Committee to meet the requirements set forth
in SEC Rule 10A-3 for listed companies. In addition, the Company currently lacks
an “audit committee financial expert.” Although the Company does not have
include any members who meet the technical definition of "audit committee
financial expert", and is not required to have an "audit committee financial
expert" because the Company's common stock is not listed on a national
securities exchange, the Board has determined that the members of the audit
committee are sufficiently financially sophisticated to perform their roles and
responsibilities as an audit committee member. The members of the Audit
Committee are Messrs. Adusumalli and Reddy, each of whom is affiliated with our
majority shareholders and therefore not "independent".




Code of Business Conduct and Ethics




We believe that good corporate governance is
important to ensure that we are managed for the long-term benefit of our
shareholders. Our Board of Directors has adopted a Code of Business Conduct and
Ethics. You can access our Code of Business Conduct and Ethics on our website
located at www.intelligroup.com or by writing to our Secretary at our offices at
5 Independence Way, Suite 220, Princeton, NJ 08540. Any substantive amendment
to, or waiver from, any provision of the code of ethics with respect to any
senior executive or financial officer will be posted on this website or in a
current report on Form 8-K.




Item 11. Executive Compensation.




The following Summary Compensation Table sets
forth information concerning compensation for services rendered in all
capacities to us and our subsidiaries for the years ended December 31, 2009 and
December 31, 2008 which was awarded to, earned by or paid to each person who
served as our principal executive officer at any time during 2009 and the two
most highly compensated executive officers other than the principal executive
officer who were serving as executive officers as of December 31, 2009
(collectively, the “Named Executive Officers”).




ChangesinPensionValueNon-
            andEquity
            NonqualifiedIncentive
            DeferredStock
            Option
            Plan
            Compensation
            All OtherName and
            
            Salary
            Bonus
            Awards
            Awards
            Compensation
            Earnings
            Compensation
            TotalPrincipal Position
            Year
            ($)
            ($)
            ($)
            ($)
            ($)
            ($)
            ($)
            ($)Vikram Gulati
            2009
            $225,000
            
            $251,100
            (1)
            
            
            
            
            
            $1,482
            (3)
            $477,582President and Chief
            2008
            $225,000
            
            $284,870
            (2)
            
            
            
            
            
            $4,500
            (3)
            $514,370Executive OfficerAlok
      Bajpai
            2009
            $114,649
            (4)
            $35,523
            (5)
            
            
            
            $510
            (4)(6)
            $26,408
            (4)(7)
            $177,090Chief Financial
            2008
            $122,871
            (8)
            $96,971
            (9)
            
            
            
            $3,703
            (6)(8)
            $24,031
            (7)(8)
            $247,576OfficerPankit Desai
            2009
            $200,000
            
            $85,732
            (10)
            
            
            
            
            
            $3,791
            (3)
            $289,523


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(1)
            
            Consists of an annual bonus of $246,200
      paid to Mr. Gulati and a bonus of $4,900 award to Mr. Gulati in accordance
      with the Profit-Sharing Bonus Plan for 2009. See the discussion under the
      heading "Profit-Sharing Bonus Plan" for additional detail regarding the
      Profit- Sharing Bonus Plan.(2)
            
            Consists of an annual bonus of $236,700
      paid to Mr. Gulati and a bonus of $48,170 awarded to Mr. Gulati in
      accordance with the principles of the Company's Profit-Sharing Bonus Plan.
      See the discussion under the heading "Profit-Sharing Bonus Plan" for
      additional detail regarding the Profit-Sharing Bonus Plan.(3)
            
            Represents matching contributions to the
      Company’s defined contribution plan in accordance with our standard
      employment policies.(4)
            
            Based upon the exchange rate of 46.53
      Indian Rupees to $1 as of December 31, 2009. Such amounts were actually
      paid in Indian Rupees.(5)
            
            Consists of an annual bonus of $30,661
      paid to Mr. Bajpai and a bonus of $4,900 awarded to Mr. Bajpai in
      accordance with Profit-Sharing Bonus Plan for fiscal 2009. See the
      discussion under the heading "Profit-Sharing Bonus Plan" for additional
      detail regarding the Profit-Sharing Bonus Plan. The annual bonus amount is
      based upon an exchange rate of 46.53 Indian Rupees to $1 and was actually
      paid in Indian Rupees.(6)
            
            Represents the increase in value during
      2009 of the post-employment benefit payable under the India Gratuity Plan.
      Payment of such post-employment-benefits under the India Gratuity Plan is
      contingent upon completion of five years of continuous
  service.(7)
            
            Represents Indian Provident Fund
      matching contributions and Car EMI payments, which represent the aggregate
      value of monthly payments made by the Company for a car which is leased by
      the Company for the applicable employee's benefit and use, paid in
      accordance with our standard employment practices.(8)
            
            Based upon the exchange rate of 48.71
      Indian Rupees to $1 as of December 31, 2008. Such amounts were actually
      paid in Indian Rupees.(9)
            
            Consists of an annual bonus of $46,064
      paid to Mr. Bajpai and a bonus of $49,381 awarded to Mr. Bajpai in
      accordance with the principles of the Company's Profit-Sharing Bonus Plan.
      See the discussion under the heading "Profit-Sharing Bonus Plan" for
      additional detail regarding the Profit-Sharing Bonus Plan. The annual
      bonus amount is based upon an exchange rate of 48.71 Indian Rupees to $1
      and was actually paid in Indian Rupees.(10)
            
            Consists of an annual bonus of $80,832
      paid to Mr. Desai and a bonus of $4,900 award to Mr. Desai in accordance
      with the Profit-Sharing Bonus Plan for 2009. See the discussion under the
      heading "Profit-Sharing Bonus Plan" for additional detail regarding the
      Profit- Sharing Bonus Plan.


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Employment Agreements




Vikram Gulati




We entered into a five year employment
agreement, as amended, with Vikram Gulati, our Chief Executive Officer and
President, effective June 30, 2005. The agreement, as amended, provides for,
among other things: (i) an annual base salary of $225,000; (ii) a potential
annual bonus in the amount of $275,000, subject to Mr. Gulati meeting certain
objectives to be agreed upon with us; (iii) a grant of 500,000 stock options
exercisable at $1.45 per share and a subsequent grant in 2006 of 400,000 options
at $1.60; (vi) reimbursement of all reasonable relocation expenses incurred by
Mr. Gulati; and (v) twenty-four months of severance pay (which shall consist of
base salary plus the incentive compensation as set forth in Section 4.2 of the
Agreement) commencing upon termination of the Agreement for reasons other than
cause (as defined in the Agreement). In addition the agreement provides that
upon the effectiveness of a Change in Control (as above): (a) option vesting
shall be accelerated by twelve (12) months for all the remaining options, to the
extent not vested and exercisable, and (b) in the event Venture Tech should own
less than ten (10%) of our outstanding shares or we terminate Mr. Gulati’s
employment or changes Mr. Gulati’s role (as defined in the Agreement) all
remaining options, to the extent not vested and exercisable, shall become fully
vested and exercisable.




Alok Bajpai




We entered into a four year employment
agreement, as amended, with Alok Bajpai effective September 7, 2006. The
agreement, as amended, provides for: (i) annual base salary of 66,66,667 Indian
rupees (equivalent to approximately $143,277 based on the exchange rate as of
December 31, 2009)); (ii) a potential annual bonus in the amount of fifty
percent of Mr. Bajpai’s annual base salary, subject to Mr. Bajpai meeting
certain objectives to be agreed upon with us; (iii) stock options exercisable
for 200,000 shares of our common stock to be issued on the effective date of the
agreement with a strike price equal to Fair Market Value (as defined in the 2004
Plan) which vest in equal quarterly installments over four years; (iv) six (6)
months notice period or six (6) month’s salary in lieu of notice in the event we
terminate the agreement for reasons other than cause and (v) three (3) months
notice period in the event Mr. Bajpai terminates the agreement. The Agreement
also provides that upon the effectiveness of a Change in Control (as defined
above) the vesting for all of the remaining options shall be accelerated by
twelve (12) months as of the effective date of the Change of Control, and that
all of the remaining option shares, to the extent not vested and exercisable,
shall become fully vested and exercisable in the event that we terminate Mr.
Bajpai’s employment.




Pankit Desai




The employment agreement provides for: (i)
annual base salary, which was initially set at $170,000, and is currently,
$200,000; (ii) a potential annual bonus in the amount of fifty percent of Mr.
Desai's annual base salary, subject to Mr. Desai meeting certain objectives to
be agreed upon with us; (iii) an initial stock option grant exercisable for
50,000 shares of our common stock issued on Mr. Desai's start date with a strike
price equal to Fair Market Value (as defined in the 2004 Plan) which vest in
equal quarterly installments over four years; (iv) three months of salary and
reimbursement of COBRA premiums in the event we terminate Mr. Desai's employment
for reasons other than cause; and (v) reimbursement of relocation costs up to
$60,000.




Other Employment
Agreements




In addition to the foregoing, we generally
enter into indemnification agreements with each of our executive officers and
directors pursuant to which we have agreed to indemnify such party to the full
extent permitted by law, subject to certain exceptions, if such party becomes
subject to an action because such party
is a director, officer, employee, agent or fiduciary of the Company.




Substantially all of our employees have
agreed, pursuant to written agreement, not to compete with us, not to disclose
our confidential information and not to solicit our employees.




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Profit-Sharing Bonus Plan




We adopted a Profit-Sharing Bonus
Plan for fiscal 2009 (the “2009 Plan”) in which certain members of the senior
management team, including our Named Executive Officers, may be eligible to
participate. The 2009 Plan was approved pursuant to resolutions duly adopted by
the compensation committee (the “Committee”) of our Board of Directors (the
“Board”) and the plan participants are subject to further approval by the
Committee. The 2009 Plan provides for, among other things, (i) the
incentive-based cash awards shall be determined based upon the EBITDA achieved
during the applicable fiscal year relative to the EBITDA achieved during the
immediately preceding fiscal year and relative to the target EBIDTA for the
applicable fiscal year (for purposes of the 2009 Plan when calculating EBITDA
the Company shall exclude stock option expense from such calculation) , (ii) ten
percent (10%) of any incremental increase in EBITDA from 2008 to 2009 and thirty
percent (30%) of any incremental EBITDA achieved over the target EBITDA for
fiscal 2009 shall be allocated for the payment of incentive-based cash awards to
be paid pursuant to the Plan and (iii) the bonuses awarded pursuant to the 2009
Plan shall be payable in two equal annual installments commencing after close of
fiscal 2009, subject to continued employment of the plan participants at the
time of payment. On February 28, 2010, the Committee decided to pay the bonuses
awarded pursuant to the 2009 Plan in one lump sum payment of $4,900 due to the
small dollar value of the awards.




We also approved cash awards for our senior
management team, including our Named Executive Officers with respect to fiscal
2008. Such cash awards approved were determined in accordance with the
principles of the 2009 Plan, except that such cash awards were reduced to fifty
percent of the amount calculated pursuant to the 2009 Plan. Pursuant to such
Committee approval, members of our senior management team, including each of its
Named Executive Officers, received cash awards payable in two equal installments
as follows: $24,085 payable following fiscal 2008 and $24,085 payable at the end
of 2009, subject to their continued employment.




---



Outstanding Equity Awards at Fiscal Year-End


The table below sets forth the outstanding
stock options for each Named Executive Officer as of December 31,
2009.
 Option AwardsEquityIncentivePlanAwards:Number of
              
              Number of
              
              Number
      ofSecurities
              
              Securities
              
              SecuritiesUnderlying
              
              Underlying
              
              UnderlyingUnexercised
              
              Unexercised
              
              Unexercised
              
              OptionOptions
              
              Options
              
              Unearned
              
              Exercise
              
              Option(#)
              
              (#)
              
              Options
              
              Price
              
              ExpirationName
              
              Exercisable
              
              Unexercisable
              
              (#)
              
              ($)
              
              Date(a)
              
              (b)
              
              (c)
              
              (d)
              
              (e)
              
              (f)Vikram
              
              500,000
              (1)
              
              —
              
              
              —
              
              $1.45
              
              6/30/2015Gulati
              
              400,000
              (2)
              
              —
              
              
              —
              
              $1.60
              
              1/10/2016Alok
              
              162,500
              (3)
              
              37,500
              (3)
              
              —
              
              $1.40
              
              9/7/2016BajpaiPankit
              
              50,000
              (4)
              
              —
              
              
              —
              
              $1.52
              
              12/12/2015Desai
              
              10,156
              (5)
              
              2,344
              
              
              
              
              $1.60
              
              08/08/2016


(1)
            
            One-sixteenth of such options
      vested immediately on date of grant, June 30, 2005 and the remaining
      options vested in fifteen equal quarterly installments commencing on
      September 30, 2005.(2)
            
            75,000 of such options vested
      immediately upon date of grant, January 10, 2006. The remaining 325,000
      vested in thirteen equal quarterly installments through April 1,
      2009.(3)
            
            Such option vests in sixteen
      equal quarterly installments commencing on December 7,
    2006.(4)
            
            Such option vested in sixteen
      equal quarterly installments commencing on March 12,
  2006.(5)
            
            Such option vests in sixteen
      equal quarterly installments commencing on November 8,
    2006.     Director Compensation
  The following table sets forth certain
information regarding the compensation earned by our non-employee directors for
service as a director during 2009.
  Change inPensionFees
              
              
              
              
              
              
              
              Value andEarned
              
              
              
              
              
              Non-Equity
              
              Nonqualifiedor
              
              
              
              
              
              Incentive
              
              Deferred
              
              AllPaid in
              
              Stock
              
              Option
              
              Plan
              
              Compensation
              
              OtherCash
              
              Awards
              
              Awards
              
              Compensation
              
              Earnings
              
              Compensation
              
              TotalName
              
              ($)
              
              ($)
              
              ($)
              
              ($)
              
              ($)
              
              ($)
              
              ($)(a)
              
              (b)
              
              (c)
              
              (d)
              
              (e)
              
              (f)
              
              (g)
              
              (j)Ravi
              
              $20,000
              
              —
              
              —
              
              —
              
              —
              
              —
              
              $20,000AdusumalliAjit Isaac(1)
              
              $2,219
              
              —
              
              —
              
              —
              
              —
              
              —
              
              $2,219Babar
              
              $2,219
              
              —
              
              —
              
              —
              
              —
              
              —
              
              $2,219Khan(2)Srinivasa
              
              $20,000
              
              —
              
              —
              
              —
              
              —
              
              —
              
              $20,000RajuSandeep
              
              $20,000
              
              —
              
              —
              
              —
              
              —
              
              —
              
              $20,000Reddy
   (1)
              
              Mr. Isaac’s
      term as a member of the Board of Directors expired at the 2009 annual
      meeting of shareholders on June 11,
2009.
  (2)
              
              Mr. Khan resigned from the Company’s the
      Board of Directors effective September 30, 2009 in connection with his
      decision to leave SB Asia Infrastructure Fund to pursue other
      opportunities.
  Our policy for compensating
non-employee directors provides for the following payments: (i) for Committee
Chairpersons and Chairman of the Board $20,000 annual fee to be paid in arrears
after our Annual Shareholders’ Meeting (such annual fee shall be pro-rated for
Chairpersons who serve less than one year) and (ii) for directors not covered in
subsection (i) $5,000 annual fee to be paid in arrears after our Annual
Shareholders’ Meeting (such annual fee shall be pro-rated for directors who
serve less than one year). We reimburse Directors for reasonable travel expenses
incurred when traveling on Company business. Members of the Board of Directors,
including non-employee Directors, also are eligible to receive option grants
pursuant to the 2004 Equity Incentive Award Plan (the “2004 Plan”). We did not
issue any option grants to any of our non-employee directors during
2009.
     Item 12. Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder Matters.
  The following table sets forth certain
information as of April 21, 2010 with respect to the beneficial ownership of
common stock of the Company by the following: (i) each of the Company's current
directors; (ii) each of the Named Executive Officers; (iii) the current
executive officers; (iv) all of the executive officers and directors as a group;
and (v) each person known by the Company to own beneficially more than five
percent (5%) of the outstanding shares of the Company's common
stock.
  For purposes of the following table,
beneficial ownership is determined in accordance with the applicable SEC rules
and the information is not necessarily indicative of beneficial ownership for
any other purpose. Except as otherwise noted in the footnotes to the table, we
believe that each person or entity named in the table has sole voting and
investment power with respect to all shares of the Company’s common stock shown
as beneficially owned by that person or entity (or shares such power with his or
her spouse). Under the SEC’s rules, shares of the Company’s common stock
issuable under options that are exercisable on or within 60 days after April 21,
2010 (“Presently Exercisable Options”) are deemed outstanding and therefore
included in the number of shares reported as beneficially owned by a person or
entity named in the table and are used to compute the percentage of the common
stock beneficially owned by that person or entity. These shares are not,
however, deemed outstanding for computing the percentage of the common stock
beneficially owned by any other person or entity.
  The percentage of the common stock
beneficially owned by each person or entity named in the following table is
based on 41,249,688 shares of common stock outstanding as of April 21, 2010 plus
any shares issuable upon exercise of Presently Exercisable Options held by such
person or entity.
  Unless otherwise indicated, the address for
the individuals below is that of the Company address.
  Name and Address of
              
              Amount and Nature of
              
              PercentBeneficial Owner
              
              Beneficial Ownership (1)
              
              of Class (2)(i)
              
              Certain BeneficialOwners (others than thoseset forth below underSection (ii)):SB Asia InfrastructureFund LP(3)
              
              25,947,122
              (4)
              
              63
              %Venture Tech AssetsLtd.(5)
              
              25,947,122
              (6)
              
              63
              %(ii)
              
              Directors and Executive
    Officers:Vikram Gulati
              
              900,000
              (7)
              
              2
              %Ravi Adusumalli
              
              —
              
              
              *Sandeep Reddy
              
              10,849,084
              (8)
              
              26
              %Srinivasa Raju
              
              —
              (9)
              
              *Alok Bajpai
              
              187,500
              (10)
              
              *Kalyan Sundaram Mahalingam
              
              75,000
              (11)
              
              *Pankit Desai
              
              76,218
              (12)(iii)
              
              All Directors andexecutive officers as agroup (7 persons)
              
              12,087,802
              (13)
              
              28
              %
     ____________________
  *
              
              Less than one percent.(1)
              
              Except as set forth in the footnotes to
      this table and subject to applicable community property law, the persons
      named in the table have sole voting and investment power with respect to
      all shares of Common Stock shown as beneficially owned by such
      shareholder.(2)
              
              Applicable percentage of ownership is
      based on 41,249,688 shares of Common Stock outstanding on April 21, 2010,
      plus any presently exercisable stock options held by each such holder, and
      options which will become exercisable within sixty (60) days after April
      21, 2010.(3)
              
              The address for SB Asia Infrastructure
      Fund L.P. (“SAIF”) is Ugland House, P.O. Box 309, George Town, Grand
      Cayman, Cayman Islands. SB Asia Pacific Partners LP is the sole general
      partner of SAIF. The address for SB Asia Pacific Partners LP is Ugland
      House, P.O. Box 309, George Town, Grand Cayman, Cayman Islands. SB Asia
      Pacific Investments Limited is the sole general partner of SB Asia Pacific
      Partners LP. The address for SB Asia Pacific Investment Limited is Ugland
      House, P.O. Box 309, George Town, Grand Cayman, Cayman Islands. Asia
      Infrastructure Investments Limited is the sole shareholder of SB Asia
      Pacific Investment Limited. The address for Asia Infrastructure
      Investments Limited is Ugland House, P.O. Box 309, George Town, Grand
      Cayman, Cayman Islands. SB First Singapore Pte. Ltd. is the voting
      shareholder of Asia Infrastructure Investments Limited that exercises
      control with respect to Asia Infrastructure Investments Limited’s interest
      in SB Asia Pacific Investments Limited. The address for SB First Singapore
      Pte. Ltd. is 8 Cross Street, #11-000 PwC Building, Singapore, 048424.
      SOFTBANK Corp. is the sole shareholder of SB First Singapore Pte. Ltd. The
      address for SOFTBANK Corp. is 24-1, Nihonbashi-Hakozakicho, Chuo-ku, Tokyo
      103-8501.
     (4)
              
              Represents 15,098,038 shares of Common
      Stock held by SAIF and an aggregate of 10,849,084 shares of Common Stock
      held by Venture Tech Assets Ltd. (“Venture Tech”). SB Asia Infrastructure
      Fund, L.P. (“SAIF”) is a party to (i) a Common Stock Purchase Agreement,
      dated as of September 29, 2004, as amended March 21, 2005 (the “2004
      Purchase Agreement”), by and among Intelligroup, Inc. (the “Company”),
      SAIF and Venture Tech and (ii) a Common Stock Purchase Agreement, dated as
      of March 30, 2006, by and among the Company, SAIF and Venture Tech (the
      “2006 Purchase Agreement,” and together with the 2004 Purchase Agreement,
      the “Purchase Agreements”). Pursuant to the Purchase Agreements, Venture
      Tech acquired an aggregate of 9,215,687 shares of Common Stock. In
      addition, Venture Tech has disclosed that in June 2005 it acquired an
      aggregate of 1,633,397 shares of Common Stock in an open market purchase.
      The Purchase Agreements provide for, under certain conditions, the
      designation by SAIF and Venture Tech of up to five members of the board of
      directors of the Company. By virtue of the Purchase Agreements, SAIF may
      be deemed a group with Venture Tech within the meaning of Section 13(d)(3)
      of the Act, and as a result, to have beneficial ownership of the
      10,849,084 shares of Common Stock beneficially owned by Venture Tech. SAIF
      disclaims such beneficial ownership. SAIF has the sole power to vote or
      direct the vote and to dispose or to direct the disposition of 15,098,038
      shares of Common Stock. Because of its position as the sole general
      partner of SAIF, SB Asia Pacific Partners LP has the sole power to vote or
      direct the vote and to dispose or to direct the disposition of 15,098,038
      shares of Common Stock. Because of its position as sole general partner of
      SB Asia Pacific Partners LP, SB Asia Pacific Investment Limited has the
      sole power to vote or direct the vote and to dispose or to direct the
      disposition of 15,098,038 shares of Common Stock. Because of its position
      as the sole shareholder of SB Asia Pacific Investment Limited, Asia
      Infrastructure Investments Limited has the sole power to vote or direct
      the vote and to dispose or to direct the disposition of 15,098,038 shares
      of Common Stock. Because of its position as the voting shareholder of Asia
      Infrastructure Investments Limited (which exercise control with respect to
      Asia Infrastructure Investment Limited’s interest in SB Asia Pacific
      Investments Limited), the sole shareholder of SB Asia Investments Limited,
      the sole general partner of SB Asia Pacific Partners, LP, and the sole
      general partner of SAIF, SB First Singapore Pte. Ltd. has the sole power
      to vote or to direct the vote and to dispose or to direct the disposition
      of 15,098,038 shares of Common Stock.(5)
              
              The address for Venture Tech is 4
      Whitcome Mews, Richmond TWP 4BT, United Kingdom.(6)
              
              Represents 10,849,084 shares of Common
      Stock held by Venture Tech and 15,098,038 shares of Common Stock held by
      SB Asia Infrastructure Fund, L.P. (“SAIF”). Venture Tech is a party to (i)
      a Common Stock Purchase Agreement, dated as of September 29, 2004, as
      amended March 21, 2005 (the “2004 Purchase Agreement”), by and among
      Intelligroup, Inc. (the “Company”), SAIF, and Venture Tech and (ii) a
      Common Stock Purchase Agreement, dated as of March 30, 2006, by and among
      the Company, SAIF and Venture Tech (the “2006 Purchase Agreement,” and
      together with the 2004 Purchase Agreement, the “Purchase Agreements”). The
      Purchase Agreements provide for, under certain conditions, the designation
      by SAIF and Venture Tech of up to five members of the board of directors
      of the Company. By virtue of the Purchase Agreements, Venture Tech may be
      deemed a group with SAIF within the meaning of Section 13(d)(3) of the
      Act, and as a result, to have beneficial ownership of the 15,098,038
      shares of Common Stock beneficially owned by SAIF. Venture Tech disclaims
      such beneficial ownership.
     (7)
              
              Represents 900,000 shares of Common
      Stock underlying Presently Exercisable Options.(8)
              
              Represents 10,849,084 shares of Common
      Stock held by Venture Tech. Due to Mr. Reddy’s position as shareholder and
      sole director of Venture Tech, Mr. Reddy may be deemed to have indirect
      beneficial ownership of the shares of Common Stock beneficially owned by
      Venture Tech.(9)
              
              Previously the Company had reported that
      Mr. Raju may be deemed an indirect beneficial owner of the 10,849,084
      shares of Common Stock held by Venture Tech because Mr. Raju’s minor child
      was a shareholder of Venture Tech. However, such child is no longer a
      minor and does not live with Mr. Raju. Therefore, Mr. Raju is no longer
      deemed a beneficial owner of such shares.(10)
              
              Represents 187,500 shares of Common
      Stock underlying Presently Exercisable Options. Excludes 12,500 shares of
      Common Stock underlying options that are not exercisable within sixty days
      of April 21, 2010.(11)
              
              Represents 75,000 shares of Common Stock
      underlying Presently Exercisable Options. Excludes 25,000 shares of Common
      Stock underlying options that are not exercisable within sixty days of
      April 21, 2010.(12)
              
              Represents 14,500 shares owned directly
      by Mr. Desai and 61,718 shares of Common Stock underlying Presently
      Exercisable Options. Excludes 782 shares of Common Stock underlying
      options that are not exercisable within sixty days of April 21,
      2010.(13)
              
              See footnotes 7 – 12
  above.
 
 Equity Compensation Plans
  The following table summarizes securities
authorized for issuance under our equity compensation plans as of December 31,
2009.
  Number of securitiesNumber of
      securities to
              Weighted-average
              remaining available forbe issued
      upon exercise
              exercise
      price of
              future issuance underof
      outstanding options
              outstanding options
              equity compensation plansEquity
      compensation plans
              
              2,731,869
              
              
              $1.91
              
              
              1,878,179approved by security holdersEquity
      compensation plans notapproved by security holders
              
              0
              
              
              —
              
              
              65,000Total
              
              2,731,869
              
              
              $1.91
              
              
              $1,943,179
      Equity Compensation Plans Approved by Security
Holders
  The 2004 Plan was approved by the Company’s
Board of Directors on April 5, 2004 and adopted by the Company’s shareholders on
June 8, 2004. The maximum number of shares of Common Stock reserved for issuance
under the 2004 Plan, as amended, shall be equal to 1,600,000, plus the number of
shares of Common Stock which are or become available for issuance under the
Company’s 1996 Stock Plan (the “1996 Plan”), and which are not issued under such
plan. Those eligible to receive stock option grants or stock purchase rights
under the 2004 Plan include employees, non-employee Directors and consultants.
The Compensation Committee administers the 2004 Plan. Subject to the provisions
of the 2004 Plan, the administrator of the 2004 Plan has the discretion to
determine the optionees and/or grantees, the type of equity awards to be granted
(incentive stock options and nonqualified stock options, restricted stock, stock
appreciation rights, performance shares, performance stock units, stock
payments, deferred stock, restricted stock units, other stock-based awards, and
performance-based awards), the vesting provisions, the terms of the grants and
such other related provisions as are consistent with the 2004 Plan. The exercise
price of a stock option may not be less than the fair market value per share of
the Common Stock on the date of grant or, in the case of an optionee who
beneficially owns 10% or more of the outstanding capital stock of the Company,
not less than 110% of the fair market value per share on the date of grant.
Notwithstanding the foregoing, the Compensation Committee is authorized to issue
options to purchase up to 500,000 shares of Common Stock with an option exercise
price of less than 100% of the fair market value of the Common Stock on the date
of grant. The options terminate not more than ten years from the date of grant,
subject to earlier termination on the optionee’s death, disability or
termination of employment with the Company, but provide that the term of any
options granted to a holder of more than 10% of the outstanding shares of
capital stock may be no longer than five years. Options are not assignable or
otherwise transferable except by will or the laws of descent and distribution.
The Compensation Committee may provide that if a Change in Control (as defined
in the 2004 Plan) of the Company occurs and any awards made pursuant to the 2004
Plan are not converted, assumed or replaced by a successor, then all outstanding
awards that are not converted, assumed or replaced will become fully vested and
exercisable.
  The Compensation Committee, subject to
approval of the Board, may terminate, amend, or modify the 2004 Plan at any
time; provided, however, that stockholder approval must be obtained for any
amendment to the extent necessary or desirable to comply with any applicable
law, regulation or stock exchange rule, to increase the number of shares
available under the 2004 Plan, to permit the Compensation Committee to grant
options with an exercise price below fair market value on the date of grant, or
to extend the exercise period for an option beyond ten years from the date of
grant. The 2004 Plan terminates on June 8, 2014 unless terminated earlier by the
Company’s Board of Directors.
     The 1996 Plan was adopted by the Board of
Directors and approved by the shareholders of the Company on June 3, 1996, and
became effective on July 12, 1996. Those eligible to receive stock option grants
or stock purchase rights under the 1996 Plan include employees, non employee
Directors and consultants. The Compensation Committee of the Board of Directors
of the Company administers the 1996 Plan. Subject to the provisions of the 1996
Plan, the Compensation Committee has the discretion to determine the optionees
and/or grantees, the type of options to be granted (incentive stock options
(“ISOs”) or non qualified stock options (“NQSOs”)), the vesting provisions, the terms of the grants and such
other related provisions as are consistent with the 1996 Plan. The exercise
price of an ISO may not be less than the fair market value per share of the
Common Stock on the date of grant or, in the case of an optionee who
beneficially owns 10% or more of the outstanding capital stock of the Company,
not less than 110% of the fair market value per share on the date of grant. The
exercise price of a NQSO may not be less than 85% of the fair market value per
share of the Common Stock on the date of grant or, in the case of an optionee
who beneficially owns 10% or more of the outstanding capital stock of the
Company, not less than 110% of the fair market value per share on the date of
grant. The purchase price of shares issued pursuant to stock purchase rights may
not be less than 50% of the fair market value of such shares as of the offer
date of such rights. The options terminate not more than ten years from the date
of grant, subject to earlier termination on the optionee’s death, disability or
termination of employment with the Company, but provide that the term of any
options granted to a holder of more than 10% of the outstanding shares of
capital stock may be no longer than five years. Options are not assignable or
otherwise transferable except by will or the laws of descent and distribution.
In the event of a merger or consolidation of the Company with or into another
corporation or the sale of all or substantially all of the Company’s assets in
which the successor corporation does not assume outstanding options or issue
equivalent options, the Board of Directors of the Company is required to provide
accelerated vesting of outstanding options. As of June 8, 2004, the Company
ceased granting options under the 1996 Plan.
  The 1996 Non-Employee Director Plan was
approved by the Board of Directors on June 3, 1996. The shareholders adopted the
Company’s 1996 Non-Employee Director Stock Option Plan (the “Director Plan”) and
it became effective on July 12, 1996. The Director Plan provides for the grant
of options to purchase a maximum of 140,000 shares of Common Stock of the
Company to non-employee Directors of the Company. The Board of Directors
administers the Director Plan.
  Equity Compensation Plans Not Approved by
Security Holders
  On October 31, 2000, the Company’s Board of
Directors approved the grant of an option to several employees for an aggregate
of 105,000 shares of Common Stock at an exercise price of $2.063 per share.
Sixty-five thousand (65,000) of such options were cancelled in 2003 in
connection with the termination of the employees to whom such options were
granted. On November 1, 2000, the Company’s Board of Directors approved the
grant of an option to former Chief Financial Officer Nicholas Visco for 60,000
shares of Common Stock at an exercise price of $2.00 per share. Each of the
above options vest in four equal semiannual installments beginning on the first
six-month anniversary of the date of grant and expire on the tenth anniversary
of the date of grant. If the grantee’s employment relationship terminates on
account of disability or death, the grantee or grantee’s estate, as the case may
be, may exercise any outstanding options for one year following the termination.
If termination is for any other reason, the grantee may exercise any outstanding
options for 90 days following such termination. The options are not assignable
or otherwise transferable except by will or the laws of descent and distribution
and shall be exercisable during the grantee’s lifetime only by the
grantee.
  The Board of Directors is required to make
appropriate adjustments in connection with such option grants in each October
and November to reflect stock splits, stock dividends and other similar changes
in capitalization. The option grants also contain provisions addressing the
consequences of a merger, consolidation or sale of all or substantially all of
the Company’s assets. Upon the occurrence of such events, all outstanding
options are to be assumed, or substituted for, by the acquiring or succeeding
corporation. However, if the acquiring or succeeding corporation does not agree
to assume, or substitute for, outstanding options, then the Board of Directors
must accelerate the options to make them fully exercisable and notify the
grantee that the option shall be fully exercisable for a period of 15 days from
the date of such notice.
     Item 13. Certain Relationships and Related
Transactions, and Director Independence.
  Certain Relationships and Related Transactions
  Effective August 1, 2005, Intelligroup Asia
Pvt. Ltd. (“IGA”) entered into an agreement to lease certain premises for
certain of our India operations from ILABS Hyderabad Technology Center Pvt. Ltd.
(“iLabs”), a party with which two members of our Board of Directors, Srinivasa
Raju and Sandeep Reddy are affiliated. The terms of the lease agreement provide
for, among other things: (1) a minimum lease period of five years with an option
for two three-year renewal periods; (2) payment of a security deposit in the
amount of 15,282,000 Indian rupees (approximately $352,000); (3) payment of
monthly lease fees in the amount of 1,698,000 Indian rupees (approx. $40,000),
subject to yearly five percent (5%) escalation; and (4) monthly operations and
maintenance fees of 283,000 Indian rupees (approximately $7,000). Prior to
entering into this lease, the disinterested members of our Board of Directors
reviewed the proposed lease and determined that the terms and conditions were no
less favorable to us than could be obtained from unrelated third
parties.
  Effective December 10, 2009, IGA entered into
an agreement to lease additional premises for certain of the Company’s India
operations iLabs. The terms of the lease provide for, among other things: (1) a
minimum lease period of 3 years with an option for two three-year renewal
periods; (2) monthly rent in the amount of 499,800 Indian rupees (approximately
$10,704), subject to fifteen percent (15%) escalation upon each renewal period;
(2) payment of a security deposit equivalent to four (4) months’ rent in the
amount of 1,999,200 Indian rupees (approximately $42,814), subject to fifteen
percent (15%) escalation; and (3) monthly operations and maintenance fees of
96,285 Indian rupees (approximately $2,062).
  Under such lease, IGA is subject to a lock-in
period for the initial term of the lease, except for a termination in connection
with iLABs’ breach, an eminent domain event or a force majeure event. If IGA
terminates the lease during the lock-in period, IGA shall be responsible for any
rent payments for the remaining term of the lease during the lock-in period. The
total amount of rent due during the lock-in period is 17,992,800 (approximately
$385,326).
  Our Board of Directors has adopted a policy
requiring that any transactions between us and our officers, directors,
principal shareholders and their affiliates be on terms no less favorable to us
than could be obtained from unrelated third parties. In addition, New Jersey law
requires that any such transactions be approved by a majority of the
disinterested members of our Board of Directors.
  Director Independence
  Our common stock is not listed on a national
securities exchange and therefore we are not subject to any corporate governance
requirements regarding independence of board or committee members. However, we
have chosen the definition of independence contained in the NASDAQ rules as
benchmark to evaluate the independence of our directors. Under NASDAQ rules, a
director will only qualify as an “independent director” if, in the opinion of
our Board of Directors, that person does not have a relationship which would
interfere with the exercise of independent judgment in carrying out the
responsibilities of a Director. Our Board of Directors has determined that none
of our directors qualify as an “independent director” as defined under Rule
4200(a)(15) of the NASDAQ Stock Market, Inc. Marketplace Rules.
     Item 14. Principal Accounting Fees and
Services.
  Audit Fees
  Audit fees consist of fees for the audit of
our financial statements, the review of the interim financial statements
included in our quarterly reports on Form 10-Q and other professional services
provided in connection with international statutory audits and regulatory
filings or engagements.
  Ernst & Young, India ("Ernst &
Young"), which was appointed as our independent registered accounting firm
commencing with the second quarter review billed us an aggregate of $344,431 in
audit fees for the year ended December 31, 2009.
  Ernst & Young LLP (“E&Y US”) billed us
an aggregate of $40,322 in audit fees for the year ended December 31, 2009 for
professional services rendered in connection with the first quarter review.
E&Y US billed us an aggregate of $573,365 in audit fees for the years ended
December 31, 2009 and 2008, respectively.
  Audit Related Fees
  Ernst & Young billed us an aggregate of
$24,250 in audit-related fees for the year ended December 31, 2009, which
principally included professional services related to correspondence between the
Company and the SEC.
  E&Y US billed us an aggregate of $22,000
in audit-related fees for the year ended December 31, 2008, which principally
included the audit of our employee benefit plan for the year ended December 31,
2007.
  Tax Fees
  Ernst & Young billed us an aggregate of
$45,000 for tax fees for the year ended December 31, 2009, which included tax
compliance, tax advice and tax planning services.
  E&Y US billed us an aggregate of $49,644
for tax fees for the year ended December 31, 2008, which included tax
compliance, tax advice and tax planning services.
  All Other Fees
  No other fees were billed for the
years ended December 31, 2009 and 2008.
  Pre-Approval Policies
  The Audit Committee has sole and direct
responsibility for setting the compensation of our independent registered public
accounting firm. The Audit Committee pre-approves all audit services to be
provided to us, whether provided by our independent registered public accounting
firm or other firms, and all other services (review, attest and non-audit) to be
provided to us by our independent registered public accounting firm; provided,
however, that de minimis non-audit services may instead be approved in
accordance with applicable SEC rules. The Audit Committee approved the services
described above under audit-related fees rendered in connection with the audit
of the employee benefit plans and Sarbanes-Oxley compliance.
     EXHIBIT INDEX
  Exhibit No.
              
              
              Description of Exhibit10.1
              †*
              
              Letter Agreement dated November 2, 2005
      between Pankit Desai and the Company.31.1
              †
              
              Certifications of Chief Executive
      Officer Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of
      the Sarbanes-Oxley Act of 200231.2
              †
              
              Certifications of Chief Financial
      Officer Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of
      the Sarbanes-Oxley Act of
2002
   *
              
              A management
      contract or compensatory plan or arrangement.†
              
              Filed
herewith.
     SIGNATURES
  Pursuant to the requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized this 30th day of April 2010.
  INTELLIGROUP, INC.By: /s/
              Vikram GulatiVikram
      GulatiChief Executive
      Officer
  Pursuant to the requirements of the Securities
Exchange Act of 1934, this report has been signed below by the following persons
on behalf of the Registrant and in the capacities and on the date indicated.
  Signature
              
              
              
              Title
              
              
              
              Date/s/
              VIKRAM GULATI
              
              Chief Executive Officer
              
              April 30, 2010Vikram Gulati
              
              and Director/s/
              ALOK BAJPAI
              
              Chief Financial Officer
              
              April 30, 2010Alok
    Bajpai
              
              and Principal
      Accounting Officer/s/
              RAVI ADUSUMALLI
              
              Director
              
              April 30, 2010Ravi
      AdusumalliDirector
              
              April 30,
      2010Srinivasa
      Raju/s/
              SANDEEP REDDY
              
              Director
              
              April 30,
      2010Sandeep
      Reddy