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SECURITIES AND
  EXCHANGE COMMISSION
  Washington, DC 20549

FORM 10-Q

QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly
period ended March 31, 2005

Commission
      file number0-20943

INTELLIGROUP,
INC.(Exact Name of Registrant as Specified In Its Charter)

|New Jersey                                 | 11-2880025                          
|------------------------------------------ | ------------------------------------
|(State or Other Jurisdiction
of            | (I.R.S. Employer Identification No.)
|Incorporation
            or Organization) |                                     
|                                           |                                     
|499 Thornall Street, Edison, New Jersey    | 08837                               
|(Address of Principal Executive Offices)   | (Zip Code)                          

(732) 590-1600(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

|Title of each class | Name of each exchange on
which registered
|------------------- | -----------------------------------------
|                    |                                          
|                    |                                          
|None                |                                          
|                    |                                          

Securities
    registered pursuant to Section 12(g) of the Act:

Common Stock, $.01
par value
(Title of Class)

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: |  | No:
|---- |  | ---

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2).

|Yes: |  | No:
|---- |  | ---

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).

|Yes: |  | No:
|---- |  | ---

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of October 18, 2005:

|Class                        | Number of Shares
|---------------------------- | ----------------
|Common Stock, $.01
par value | 35,102,440      



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TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

|           |    |                                                                                                                                                               | Page
|---------- | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----
|Item 1.    |    | Unaudited Condensed Consolidated Financial Statements                                                                                                         |     
|           |    |                                                                                                                                                               |     
|           |    | Condensed
    Consolidated Balance Sheets as of March 31, 2005 and December 31, 2004                                                                          | 4   
|           |    |                                                                                                                                                               |     
|           |    | Condensed Consolidated Statements
        of Operations and Comprehensive Income (Loss) for the Three Months Ended
        March 31, 2005 and 2004 (Restated) | 5   
|           |    |                                                                                                                                                               |     
|           |    | Condensed
          Statements of Cash Flows for the Three Months Ended March 31, 2005
    and 2004 (Restated)                                                | 6   
|           |    |                                                                                                                                                               |     
|           |    | Notes to Condensed Consolidated Financial Statements                                                                                                          | 7   
|           |    |                                                                                                                                                               |     
|Item 2.    |    | Managements
    Discussion
and Analysis of Financial Condition and Results of Operations                                                                     | 17  
|           |    |                                                                                                                                                               |     
|Item 3.    |    | Quantitative and Qualitative Disclosures About Market Risk                                                                                                    | 29  
|           |    |                                                                                                                                                               |     
|Item 4.    |    | Controls and Procedures                                                                                                                                       | 30  
|           |    |                                                                                                                                                               |     
|           |    | PART
    II. OTHER INFORMATION                                                                                                                                |     
|           |    |                                                                                                                                                               |     
|Item 1.    |    | Legal Proceedings                                                                                                                                             | 35  
|           |    |                                                                                                                                                               |     
|Item 5.    |    | Other Information                                                                                                                                             | 36  
|           |    |                                                                                                                                                               |     
|Item 6     |    | Exhibits                                                                                                                                                      | 37  
|           |    |                                                                                                                                                               |     
|SIGNATURES | 38

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This
      quarterly report on Form 10-Q contains forward-looking statements within
      the meaning of Section 27A of the Securities Act of 1933 and Section 21E
      of  the Securities Exchange Act of 1934. Forward-looking statements include,
      among other things, business strategy and expectations concerning industry
      conditions, market position, future operations, margins, profitability,
      liquidity and capital
resources. Forward-looking statements generally can be identified by the use
      of terminology such as may, will, expect, intend, estimate, anticipate or believe or
       similar expressions or the negatives thereof. These expectations are based
      on managements assumptions and current beliefs based on currently
      available information. Although the Company believes that the expectations
      reflected in such  statements are reasonable, it can give no assurance
      that such expectations will be correct. You are cautioned not to place
      undue reliance on these forward-looking statements, which speak only as
      of the date of this quarterly report on Form 10-Q. The
Companys operations are subject to a number of uncertainties, risks and
other influences, many of which are outside its control, and any one of which,
or a combination of which, could cause its actual results of operations to differ
materially  from the forward-looking statements. Important factors that could
cause actual results to differ materially from its expectations are disclosed
in Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations and elsewhere in this quarterly report
on Form 10-Q.


Restatement of Prior Periods Consolidated Financial Statements

The historical financial information for the three months ended March 31, 2004 has been restated. In September 2004, Intelligroup, Inc. (the Company)
discovered unreconciled differences in intercompany accounts and certain other accounting errors in prior periods which resulted in adjustments to revenue, the cumulative currency translation adjustment account and accumulated deficit. As a result,
the Company's Audit Committee concluded that the Company's previously issued consolidated financial statements for the years ended December 31, 2003, 2002 and 2001 as well as all quarterly periods beginning January 1, 2001, through the quarter ended
March 31, 2004 should no longer be relied upon.


Due to the volume of transactions underlying the proposed adjustments and the Companys engagement of a new independent registered public accounting firm as of
November 1, 2004, the Company decided, in consultation with its new independent registered public accounting firm, to re-audit its consolidated financial statements for the years ended December 31, 2003 and 2002 and to re-review the quarterly
periods included therein and the quarterly period ended March 31, 2004. See Note 1 to the consolidated financial information included in Item 1 of this report for information regarding the effects of the restatement on the Companys operating
results for the quarter ended March 31, 2004. Also see Form 10-K for the year ended December 31, 2004 for the complete detail of the restatements.


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PART I - ITEM
1

FINANCIAL
  STATEMENTS
  INTELLIGROUP, INC.

CONDENSED
          CONSOLIDATED BALANCE SHEETS
    MARCH 31, 2005 (UNAUDITED) AND DECEMBER
          31, 2004

|                                                                                  | March 31,2005 |             | December 31,2004 |  
|--------------------------------------------------------------------------------- | ------------- | ----------- | ---------------- | -
|                                                                                  |              
|                                                                                  | (unaudited)   |             | (See Note 1)    
|ASSETS                                                                            |               |             |                  |  
|CURRENT ASSETS                                                                    |               |             |                  |  
|Cash and cash equivalents                                                         | $             | 7,112,000   |                  | $
|Accounts
              receivable, less allowance for doubtful accounts of        |               |             |                  |  
|$1,513,000 and $1,627,000
 at March 31, 2005 and December 31, 2004,               |               |             |                  |  
|respectively                                                                      |               | 26,295,000  |                  |  
|Unbilled services                                                                 |               | 10,556,000  |                  |  
|Prepaid
              expenses and other current assets                           |               | 2,362,000   |                  |  
|                                                                                  |               |             |                  |  
|Total
              current assets                                                |               | 46,325,000  |                  |  
|Property and equipment,
net                                                       |               | 3,425,000   |                  |  
|Deferred tax and other
assets                                                     |               | 1,916,000   |                  |  
|                                                                                  |               |             |                  |  
|Total
              assets                                                        | $             | 51,666,000  |                  | $
|                                                                                  |               |             |                  |  
|LIABILITIES AND
SHAREHOLDERS' EQUITY                                              |               |             |                  |  
|CURRENT LIABILITIES                                                               |               |             |                  |  
|Line
              of credit                                                      | $             | 5,943,000   |                  | $
|Accounts
              payable                                                    |               | 2,957,000   |                  |  
|Accrued
              payroll and related taxes                                   |               | 10,146,000  |                  |  
|Accrued
              expenses and other current liabilities                      |               | 6,149,000   |                  |  
|Deferred
              revenue                                                    |               | 967,000     |                  |  
|Income
              taxes payable                                                |               | 544,000     |                  |  
|Current
              portion ofobligations
              under capital lease     |               | 468,000     |                  |  
|                                                                                  |               |             |                  |  
|Total
              current liabilities                                           |               | 27,174,000  |                  |  
|                                                                                  |               |             |                  |  
|Obligations undercapital
lease, net of current portion                            |               | —           |                  |  
|Other long-term liabilities                                                       |               | 359,000     |                  |  
|                                                                                  |               |             |                  |  
|Total
              liabilities                                                   |               | 27,533,000  |                  |  
|                                                                                  |               |             |                  |  
|Commitments and contingencies                                                     |               |             |                  |  
|                                                                                  |               |             |                  |  
|Shareholders'
Equity                                                              |               |             |                  |  
|Preferred
              stock, $.01
 par value, 5,000,000 shares authorized, none |               |             |                  |  
|issued
              or outstanding                                               |               | —           |                  |  
|Common
              stock, $.01
 par value, 40,000,000 shares                    |               |             |                  |  
|authorized,
              35,103,000 shares issued and outstanding                |               |             |                  |  
|at
              March 31, 2005 and December 31, 2004                             |               | 351,000     |                  |  
|Additional
              paid-in capital                                          |               | 58,012,000  |                  |  
|Accumulated
              deficit                                                 |               | (34,147,000 | )                |  
|Accumulated
              other comprehensive loss                                |               | (83,000     | )                |  
|                                                                                  |               |             |                  |  
|Total
              shareholders' equity                                          |               | 24,133,000  |                  |  
|                                                                                  |               |             |                  |  
|Total
              liabilities and shareholders' equity                          | $             | 51,666,000  |                  | $
|                                                                                  |               |             |                  |  

See accompanying notes.

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INTELLIGROUP, INC.

CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
FOR THE
THREE MONTHS ENDED MARCH 31, 2005 AND 2004(Restated)(Unaudited)

|                                                                                          | Three Months Ended March 31, |           
|----------------------------------------------------------------------------------------- | ---------------------------- | ----------
|                                                                                          |                              |           
|                                                                                          | 2005                         |           
|                                                                                          |                              |           
|Revenue                                                                                   | $                            | 32,436,000
|Cost of revenue                                                                           |                              | 24,303,000
|                                                                                          |                              |           
|Gross
              profit                                                                |                              | 8,133,000 
|                                                                                          |                              |           
|Selling, general and administrative
expenses                                              |                              | 8,418,000 
|Depreciation and amortization                                                             |                              | 437,000   
|                                                                                          |                              |           
|Total
              operating expenses                                                    |                              | 8,855,000 
|                                                                                          |                              |           
|Operating
              income (loss)                                                     |                              | (722,000  
|Interest income                                                                           |                              | 16,000    
|Interest expense                                                                          |                              | (73,000   
|Other expense                                                                             |                              | (219,000  
|                                                                                          |                              |           
|Income (loss) before income
tax                                                           |                              | (998,000  
|Benefit of income taxes                                                                   |                              | (307,000  
|                                                                                          |                              |           
|Net income (loss)                                                                         | $                            | (691,000  
|                                                                                          |                              |           
|Earnings (loss) per share:                                                                |                              |           
|Basic
              earnings (loss) per share                                             | $                            | (0.02     
|Weighted
              average number of common shares                                    |                              |           
|outstanding
              - basic                                                         |                              | 35,103,000
|                                                                                          |                              |           
|Diluted
              earnings (loss) per share                                           | $                            | (0.02     
|Weighted
              average number of common shares                                    |                              |           
|outstanding
              - diluted                                                       |                              | 35,103,000
|Comprehensive income (loss)                                                               |                              |           
|Net
              income (loss)                                                           | $                            | (691,000  
|Other
              comprehensive income - currency
              translation adjustments |                              | 178,000   
|                                                                                          |                              |           
|Comprehensive income (loss)                                                               | $                            | (513,000  
|                                                                                          |                              |           

See accompanying notes.

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INTELLIGROUP, INC.

CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS
  For The Three Months Ended March 31, 2005 and 2004 (Restated)(Unaudited)

|                                                                | Three Months Ended March 31 |           
|--------------------------------------------------------------- | --------------------------- | ----------
|                                                                |                             |           
|                                                                |                             | 2005      
|Cash flows from operating activities:                           |                             |           
|Net
              income (loss)                                 | $                           | (691,000  
|Adjustments
              to reconcile net income (loss) to net |                             |           
|cash provided by (used in) operating activities                 |                             | (1,604,000
|                                                                |                             |           
|Net cash provided by (used in) operating activities             |                             | (2,295,000
|                                                                |                             |           
|Cash flows from investing activities:                           |                             |           
|Purchase
              of property and equipment                |                             | (159,000  
|                                                                |                             |           
|Net cash used in investing activities                           |                             | (159,000  
|                                                                |                             |           
|Cash flows from financing activities:                           |                             |           
|Principal
              payments under capital leases           |                             | (213,000  
|Proceeds
              from exercise of stock options           |                             | —         
|Net
              change in line of credit borrowings           |                             | 3,587,000 
|                                                                |                             |           
|Net cash provided by financing activities                       |                             | 3,374,000 
|                                                                |                             |           
|Effect of foreign currency exchange rate changes on cash        |                             | (47,000   
|Net increase in cash and cash equivalents                       |                             | 873,000   
|Cash and cash equivalents - beginning of period                 |                             | 6,239,000 
|                                                                |                             |           
|Cash and cash equivalents - end of period                       | $                           | 7,112,000 
|                                                                |                             |           

See accompanying notes.

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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2005 AND 2004



The condensed
consolidated financial statements and accompanying financial information as of
March 31, 2005
and for the three months ended March 31, 2005 and 2004 are unaudited and, in
the opinion of management, include all adjustments (consisting only of normal
recurring adjustments) which the Company considers necessary for a fair presentation
of the financial position of the Company at such dates, and the operating results
and cash flows for
those periods.  The unaudited condensed consolidated financial statements included
herein have been prepared in accordance with accounting principles generally
accepted
in
the United
States of America and the instructions of Form 10-Q and Rule 10-01 of Regulation
S-X. Pursuant to accounting requirements of the Securities and Exchange Commission
applicable to quarterly reports on Form 10-Q, the accompanying unaudited condensed
consolidated financial statements and these notes do not include all disclosures
required by accounting
principles generally accepted in the United States of America for audited financial
statements. Accordingly, these statements should be read in conjunction with
the accounting policies and Notes to Consolidated Financial Statements included
in the
Company's consolidated financial statements filed on Form 10-K for the year ended
December 31, 2004, which was filed on October 24, 2005.


These unaudited condensed consolidated financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary to present fairly
the consolidated operations and cash flows for the periods presented. The amounts for December 31, 2004 have been extracted from the audited consolidated financial statements included in Form 10-K for the year ended December 31, 2004.


The results of the Companys operations for the three months ended March 31, 2005 are not necessarily indicative of the results of operations to be expected for the full year ending
December 31, 2005.


Restatement of Prior Periods Consolidated Financial Statements

The historical financial information for the three months ended March 31, 2004 in this document has been restated.  In September 2004, the Company discovered unreconciled differences in
intercompany accounts and certain other accounting errors in prior periods which resulted in adjustments to revenue, the cumulative currency translation adjustment account and accumulated deficit.  As a result, the Company's Audit Committee
concluded that the Company's previously issued consolidated financial statements for the years ended December 31, 2003, 2002 and 2001, as well as all quarterly periods beginning January 1, 2001, through March 31, 2004 should no longer be relied
upon.


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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE
1 -BASIS
OF PRESENTATION(CONTINUED)

Due to the volume of transactions underlying the proposed adjustments and the Companys engagement of a new independent registered public accounting firm as of November 1, 2004, the Company
  decided, in consultation with its new external independent registered public accounting firm, to re-audit the consolidated financial statements for the years ended December 31, 2003 and 2002 and to re-review the quarterly periods included therein
  and the quarterly period ended March 31, 2004.


The effects of the restatements and re-audit adjustments on net income (loss), accumulated deficit and earnings (loss) per share is as follows:


As of and for the unaudited three months ended March 31, 2004, net income increased $99,000, from $279,000 to $378,000; accumulated deficit increased $6,938,000 from
$25,274,000 to $32,212,000; and basic earnings per share did not change for the unaudited three months ended March 31, 2004; and diluted earnings increased $.01 from $.01 to $.02 for the unaudited three months ended March 31,
2004.


The Company urges investors to see Form 10-K for the year ended December 31, 2004 for the complete detail of the restatements.


NOTE
2 -SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES

Stock-Based Compensation

Employee stock
awards
under the Company’s compensation plans are accounted for in accordance
with Accounting
Principles Board Opinion No. 25 (APB 25), Accounting for Stock

Issued to Employees, and related interpretations. The Company provides
the disclosure requirements of Statement of Financial Accounting Standards (SFAS)
No.
123, Accounting for Stock-Based Compensation (SFAS 123),
and related  interpretations. Stock-based awards to non-employees are accounted
for under the provisions of SFAS 123 and the Company has adopted the enhanced
disclosure
provisions of SFAS No. 148 Accounting for Stock-Based Compensation-Transition
and Disclosure, an
amendment of SFAS No. 123.


The Company measures compensation expense for its employee stock-based compensation using the intrinsic-value method. Under the intrinsic-value method of accounting for stock-based compensation,
when the exercise price of options granted to employees is less than the estimated fair value of the underlying stock on the date of grant, deferred compensation is recognized and is amortized to compensation expense over the applicable vesting
period. In each of the periods presented, the vesting period varies from immediate to four years.


For disclosure purposes,
    pro forma net loss and loss per share impacts are provided as if the fair
  value method under SFAS 123 had been applied:


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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 2 - SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES(CONTINUED)

|                                           | Three Months EndedMarch
      31,
|------------------------------------------ | ---------------------------------
|                                           |                                  
|                                           | 2005                             
|                                           |                                  
|                                           |                                  
|Net income (loss), as reported             | $                                
|Less: Total stock-based employee           |                                  
|compensation expense determined            |                                  
|under fair-value based method for all      |                                  
|awards, net of related tax effects         |                                  
|                                           |                                  
|Pro forma net income (loss)                | $                                
|                                           |                                  
|Basic and diluted income (loss) per share: |                                  
|As reported                                | $                                
|                                           |                                  
|Pro forma                                  | $                                
|                                           |                                  

Earnings (Loss) Per Share of Common Stock

Basic earnings
   (loss) per common share (EPS) is computed using the weighted average
  number of common shares outstanding for the period. Diluted earnings per share
  includes additional dilution from potential common stock, such as stock issuable
  pursuant to the exercise of stock options and warrants.


The following is a reconciliation of the computation for basic and diluted EPS:


|                                      |      | Three Months EndedMarch
31,
|------------------------------------- | ---- | ---------------------------
|                                      |      |                            
|                                      | 2005 |                            
|                                      |      |                            
|                                      |      |                            
|Net income (loss)                     | $    | (691,000                   
|                                      |      |                            
|Weighted-average common shares        |      |                            
|outstanding :                         |      |                            
|Basic                                 |      | 35,103,000                 
|Effect of dilutive securities-        |      |                            
|stock options                         |      | —                          
|                                      |      |                            
|Diluted                               |      | 35,103,000                 
|                                      |      |                            
|Basic net earnings (loss) per share   | $    | (0.02                      
|                                      |      |                            
|Diluted net earnings (loss) per share | $    | (0.02                      
|                                      |      |                            

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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 2 - SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

In September 2004, the
    Company issued 17,647,000 shares of common stock in a private placement transaction
  for gross proceeds of $15,000,000 and net proceeds of $14,675,000.


Options to purchase
      1,662,000 and 255,000 shares of common stock at March 31, 2005 and 2004,
      respectively, were not included in the computation of diluted
    EPS because inclusion would have been anti-dilutive.


NOTE
3 - LINE OF CREDIT

On May
      31, 2000, the Company and PNC Bank, N.A. (the Bank) entered
      into a three-year revolving credit facility. In July 2003, the credit facility
      was extended until May 31, 2006. The  credit facility is currently comprised
      of a revolving line of credit pursuant to which the Company may borrow
      up to $15,000,000
    at the Bank's prime rate per annum. The credit facility is collateralized
    by substantially all of the assets of the Company's United States based operations.
    The maximum borrowing availability under the line of credit is based upon
    a
percentage of eligible billed and unbilled accounts receivable, as defined.


As of March 31, 2005,
    the Company was in default under the terms of its credit facility due to the
    Companys failure to timely deliver to the Bank certain monthly reporting schedules,
    monthly financial statements, quarterly financial statements, and annual financial statements during 2004 and 2005. In addition, as of April 4, 2005, the Company was also in default under the terms of its credit facility due to the Companys
    removal of Arjun Valluri from his position as Chief Executive Officer and President. On September 30, 2005, the Company and the Bank executed the Sixth Amendment to the Loan Documents and Waiver Agreement (the Sixth Amendment). The terms
    of the Sixth Amendment amend the Loan Documents as follows: (i) to prevent the Company from electing to borrow, convert to or continue a Eurodollar Rate Loan and to provide that all Advances bear an interest rate per annum equal to the Base Rate (as
    such term is defined in the Credit Agreement); (ii) to define Change in Management as any change in the Companys Chief Executive Officer or Chief Financial Officer, which is not acceptable to the Bank; (iii) to define
Revolving Interest Rate as interest rate per annum equal to the Base Rate; (iv) to define Undrawn Availability to include the redemption value of a specified bank account in the calculation of Undrawn Availability; and (v) to
    add an early termination fee in an amount equal to one-half of one percent (.50%) of the maximum revolving advance amount. Under the terms of the Sixth Amendment, the Company was required, among other things, to deliver draft, unaudited financial
    statements to the Bank on or before September 30, 2005 and to deliver audited annual financial statements to the Bank on or before October 15, 2005.  The Company has satisfied each of these two requirements.  The Company also agreed to resume timely
    filing of the periodic reports due to the listing exchange upon which the Companys shares are traded and to any governmental agency beginning with the filing of the Companys annual report on Form 10-K for the year ending December 31,
    2005. The Bank agreed to waive any events of default arising from the Companys
    failure to timely deliver to the Bank the monthly reporting schedules, monthly
  financial statements, quarterly financial statements and annual financial


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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 3 - LINE
OF CREDIT (CONTINUED)

statements
      and the Companys
    removal of Arjun Valluri from his position as Chief Executive Officer, President
  and Chairman of the Board.

As of
      March 31, 2005, the Company had outstanding borrowings under the credit
      facility of $5,943,000. The Company estimates undrawn availability
      under the credit facility to be
$9,057,000 as of March 31, 2005.


NOTE 4 - RELATED
PARTY TRANSACTIONS

For the three months
    ended March 31, 2005 and 2004, the Company paid $13,400 and $26,563,
    respectively, in fees to SBLI USA Mutual Life Insurance Company, Inc. A member
    of the Board of Directors served as the Chief Financial Officer of SBLI USA
  Mutual Life Insurance Company during 2004.


Nagarjun Valluripalli,
    the Companys former Chairman of the Board, President, Chief Executive Officer and a former Director of the Company is an owner (the Owner) of real estate
    located at 5-9-22, Secretariat Road in Hyderabad, India. On October 2, 2003, Intelligroup Asia Private, Ltd. (IGA) and the Owner executed a memorandum of understanding (the MOA)
    relating to a proposed lease whereby the Owner would lease the 5th and 6th floors
    of the property (Premises) to the Company for certain of the Companys India operations. As contemplated in the MOA, on June 18, 2004, the Owner and IGA executed leases for
    the Premises and the amenities, furnishings and fittings. The leases provide for a minimum lease period of three years with a renewal option for an additional three years. The leases provide for a three-month notice period for either party to
    terminate the lease. Under the terms of the lease for the amenities, IGA paid a deposit of 5,820,000 Indian rupees (approximately $133,000) and advance lease rentals of 11,640,000 Indian rupees (approximately $266,000) upon the handing over
    of the amenities and shall pay monthly rent of 1,164,000 Indian rupees (approximately $27,000). Under the terms of the lease for the Premises, IGA paid a deposit of 4,656,000 Indian rupees (approximately $106,000) and advance lease rentals
    of 9,312,000 Indian rupees (approximately $213,000) upon handing over of the Premises and shall pay monthly rent of 931,000 Indian rupees (approximately $21,000).
    Rent expense for the three months ended March 31, 2005 towards the lease
  was 7,261,000 Indian rupees (approximately $166,000).  The value of un-amortized rentals as of March 31, 2005 was 11,524,000 Indian rupees (approximately $263,000).


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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 5 - LITIGATION

India Tax Assessments

The Company's India
    subsidiary has received tax assessments dated February 12, 2002, July 23, 2002,
    August 22, 2003, and December 31, 2003 from the India taxing authority denying
    tax exemptions claimed for certain revenue earned and disallowing certain expenses
    claimed during the Indian subsidiarys fiscal years ended March 31, 1998 through March 31, 2001. The revised tax assessments were for 14.6 million, 9.5 million, 2.8 million,
    and 5.6 million Indian rupees, respectively, or approximately $742,000 in total. An additional assessment for tax penalties and interest for the fiscal year ended March 31, 2001 of 1.7 million Indian rupees, or approximately $39,000, was
    also received. The Company has made payments of approximately $815,000 (consisting of $682,000 for taxes paid under protest, $39,000 for tax penalties and interest and $94,000 for other tax adjustments not in dispute) to the India
    tax authority. The Companys resulting overpayment of $34,000 has
  been refunded.


On March 29, 2005, the
    Companys India subsidiary received an additional revised assessment for 15.0 million Indian rupees, or approximately $345,000 (recorded as part of the
    restatement in 2001), for the fiscal year ended March 31, 2002. The assessment disallowed some of the export revenue claimed by the Company and also disallowed certain expenses claimed by the Company. The Company has paid approximately 6.0 million
    Indian rupees, or approximately $137,000, under protest and has also paid an additional 5.1 million Indian rupees, or approximately $118,000, for agreed-to adjustments through October 2005. The Company is currently challenging the remaining
    unpaid assessment with the Commissioner of Tax Appeals but pending resolution of such appeal, the Company plans to pay the remaining $89,000
    tax assessment in installments over the next 12 to 18 months as permitted by
  the India tax authority.


The Company is currently at the Appellant Tribunal stage for the fiscal years ended March 31, 1998 through March 31, 2001 and at the Commissioner of Income Tax Appeals stage for fiscal year
  ended March 31, 2002.  All applicable amounts noted above had been paid or accrued as of March 31, 2005.


Shareholder Class Actions

Six
      class action lawsuits have been initiated, purportedly on behalf of plaintiffs
      who purchased the
    Companys securities, against the Company and certain former officers,
    including Arjun  Valluri, Nicholas Visco, Edward Carr and David Distel (Defendants)
    (collectively, Shareholder Class Actions) in the United States
    District Court, District of New Jersey (District of New Jersey).
    In August 2005, the District of New Jersey consolidated the six class actions
    (the Shareholder Class Action) and appointed a lead plaintiff.
    Plaintiffs subsequently dropped Mr. Distel and Mr. Carr from the Shareholder
    Class Action, failing to name either of them as a defendant in the amended
    consolidated complaint filed on or about October 10, 2005. The Shareholder
    Class Action generally alleges violations of federal securities laws, including
    allegations
    that
    the Defendants
    made materially false and misleading statements regarding the Companys
    financial condition and that the Defendants materially overstated financial
    results by engaging in improper accounting practices. The Class Period alleged
    is May 1, 2001 through September 24, 2004. The Shareholder Class Action
    generally seeks relief in the form of unspecified compensatory damages and
  reasonable costs, expenses and legal fees.


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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 5-LITIGATION(CONTINUED)

SEC Investigation

On January 28, 2005, the Company received subpoenas in connection with a formal investigation by the Securities and Exchange Commission (the SEC) regarding whether federal securities
laws were violated in connection with the issuance of the Companys financial statements for prior periods. The Company is cooperating with the SEC to produce documents in response to the subpoenas.


Broadview Claim

On or about March 23, 2005, Jefferies & Company, Inc. initiated an arbitration proceeding to recover fees in the amount of $750,000 plus interest and reasonable attorneys fees and
costs allegedly owed to Broadview International, a division of Jefferies & Company (Broadview) as a result of the private placement transaction that the Company closed on September 30, 2004 with SB Asia Infrastructure Fund, L.P. and
Venture Tech Assets Pvt. Ltd. The arbitration proceeding is in the discovery phase. In the event the Company does not prevail at the arbitration proceeding, the Company will be liable for $750,000 plus interest and reimbursement of
attorneys fees and costs.


There is no other litigation pending to which the Company is a party or to which any of its property is subject which would have a material impact on the Companys consolidated financial
condition, results of operations or cash flows in the event the Company was unsuccessful in such litigation.


NOTE 6- SEGMENT DATA AND GEOGRAPHIC INFORMATION

The Company operates in one industry segment, information technology solutions and services.


The Company has four reportable geographic operating segments which are organized and managed on a geographical basis, as follows:


| | • | United
          States (US)  the largest segment of the Company,
          with operations in the United
          States and Puerto Rico.
Includes the operations of the Companys US subsidiary,
Empower, Inc., and all corporate functions and activities. The US and corporate headquarters is located in Edison, New Jersey;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                      
| | • | India  includes
          the operations of the Company in India, including services provided on
          behalf of other group subsidiaries, primarily to the US. The India
          headquarters is located
    in Hyderabad, India;                                                                                            
| |   |                                                                                                                                                                                                                                                                                                                                      

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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 6- SEGMENT DATA AND GEOGRAPHIC INFORMATION(CONTINUED)

| | • | Europe  includes
          the operations of the Company in Denmark, Sweden and the United
          Kingdom. The European headquarters is located
in Milton Keynes, United Kingdom;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                      
| | • | Japan  includes
          the operations of the Company in Japan. The Japanese headquarters is
    located in Tokyo, Japan.                                                         
| |   |                                                                                                                                                                                      

Each of the operating
segments has a Managing Director, or equivalent position, who reports directly
to the Chief Executive Officer (CEO). Currently, the CEO and President is
fulfilling the requirements of this position in the US. The CEO has been identified as the Chief Operating Decision Maker (CODM)
because he has final authority over resource allocation decisions and performance
assessment. The CODM regularly receives certain discrete financial information
about the geographical operating segments, including primarily revenue and operating
income, to evaluate segment performance.


Accordingly, the Companys
consolidated operating results for the three months ended March 31, 2005 and
2004 and financial position as of March 31, 2005 and 2004 are presented in the
following geographic segments:


|                                              |   | United     |   |   |            |  |   |           |   |   |           |   |   |            |  
|--------------------------------------------- | - | ---------- | - | - | ---------- |  | - | --------- | - | - | --------- | - | - | ---------- | -
|                                              |   | States     |   |   | India      |  |   | Europe    |   |   | Japan     |   |   | Total      |  
|                                              |   |            |   |   |            |  |   |           |   |   |           |   |   |            |  
|Three months ended March 31, 2005             |   |            |   |   |            |  |   |           |   |   |           |   |   |            |  
|Revenue                                       | $ | 22,893,000 |   | $ | 6,791,000  |  | $ | 1,950,000 |   | $ | 802,000   |   | $ | 32,436,000 |  
|Operating
            income (loss)           |   | (1,592,000 | ) |   | 1,205,000  |  |   | (148,000  | ) |   | (187,000  | ) |   | (722,000   | )
|Income (loss)
            before income taxes |   | (1,509,000 | ) |   | 1,162,000  |  |   | (405,000  | ) |   | (246,000  | ) |   | (998,000   | )
|Total assets                                  |   | 37,358,000 |   |   | 10,120,000 |  |   | 2,842,000 |   |   | 1,346,000 |   |   | 51,666,000 |  
|Three months ended March 31, 2004 (Restated)  |   |            |   |   |            |  |   |           |   |   |           |   |   |            |  
|Revenue                                       | $ | 23,410,000 |   | $ | 4,184,000  |  | $ | 2,078,000 |   | $ | 864,000   |   | $ | 30,536,000 |  
|Operating
            income                  |   | 64,000     |   |   | 505,000    |  |   | 248,000   |   |   | 94,000    |   |   | 911,000    |  
|Income (loss)
            before income taxes |   | (141,000   | ) |   | 152,000    |  |   | 33,000    |   |   | 143,000   |   |   | 187,000    |  
|Total assets                                  |   | 27,974,000 |   |   | 7,708,000  |  |   | 3,011,000 |   |   | 1,133,000 |   |   | 39,826,000 |  

| 
|-
|•
| 

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INTELLIGROUP, INC.

NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 7- COMMITMENTS AND CONTINGENCIES

Tax-Free Spin-off of SeraNova

On July 5, 2000, the Company
distributed all of the outstanding common stock of SeraNova Inc. (SeraNova)
to its
shareholders
in
a
transaction
that
was structured to be and reported as a tax-free spin-off pursuant to Section
355 of the
Internal Revenue Code (IRC Section 355). For distributions of stock
qualifying under IRC Section 355, neither the Company nor the Companys
shareholders recognize any gain or income in connection with the transaction.
The Company  and SeraNova executed a Tax Sharing Agreement, dated January 1,
2000 (Tax Sharing Agreement), whereby SeraNova agreed to indemnify
the
Company for any tax liabilities in the event a future transaction of SeraNova
results in the spin-off  being deemed a taxable event. However, subsequently
SeraNova and its parent company, Silverline Technologies, Inc. filed for Chapter
7 Bankruptcy. Additionally, as a condition to the distribution, SeraNova management
represented that there was no
present plan, nor intent to enter into a subsequent transaction that would disturb
the intended taxfree nature of the distribution.


On October 27, 2000, SeraNova and Silverline Technologies, Inc. announced that they had entered into an agreement and plan of merger, under which Silverline Technologies, Inc. would acquire
control of SeraNova in exchange for American depository shares of Silverline. Subsequently, SeraNova and Silverline Technologies, Inc. filed for Chapter 7 Bankruptcy on August 8, 2003.


IRC Section 355(e) provides that the Company may be required to recognize a gain equal to the excess of the fair market value of the SeraNova shares distributed over their tax basis if the
distribution is part of a plan pursuant to which one or more persons acquire 50% or more of SeraNova common stock within two years of the distribution date. Should the spin-off ultimately be construed as taxable, the resultant tax liability could be
up to $65,000,000, plus interest and penalties, depending on the facts that
ultimately are established. No future benefits would inure to the Company as
a result of imposition of a tax on the SeraNova distribution, and no reserve
has been
recorded for this potential tax.


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INTELLIGROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2005 AND 2004

NOTE 7- COMMITMENTS AND CONTINGENCIES (CONTINUED)

Employment Agreements


As of March 31, 2005,
the Company had employment agreements with certain of its executive officers,
which provide for minimum payments in the event of termination for reasons other
than just cause. The aggregate amount of compensation commitment in the event
of termination under such agreements is approximately $1,725,000. Of this
amount, approximately $1,057,000
represents amounts provided for in severance packages between Intelligroup Asia
Pvt. Ltd. (IGA) and certain members of the IGA management team.
Pursuant to the terms of the agreement for severance package, the severance package
is activated upon the fulfillment of certain events, including a  Change in Management
(as defined in the severance package) of the Company or IGA. In April 2005, following
the
termination
of
the
Companys
Chief Executive Officer, certain members of the IGA management team, some of
whom had a severance package, resigned. Except as set forth below, to date, the
Company
has not received any claim for payment of amounts potentially due under the severance
packageas
a result of these resignations.
Furthermore, the Company does not believe that any payments are due and owing
under the terms
of the severance package. In or about September
2005,
two
former

members of the IGA management team sent IGA notices under Sections 433 and 434
of the Indian Companies Act, 1956 for payment of such Severance Package. The
Company does not believe that such severance amount is owed. In the event the
Company is  unsuccessful in defending against such claim for payment, the Company
would owe approximately $560,000
to such individuals.


Tax Contingency in India


The Company is currently
appealing the tax assessments received by the Companys India subsidiary
denying tax exemptions claimed during each of the fiscal years ended March 31,
1999 through
March 31, 2002. In the event the Companys appeal is not successful, future
cash outlays of approximately $89,000
would be required. The tax provisions for these assessments have already been
recorded in prior year consolidated financial
statements. See Note 5 to consolidated financial information included
in Item 1 of this report.


NOTE 8- SUBSEQUENT EVENTS

On April 4, 2005, the Company removed Mr. Valluri from his position as Chief Executive Officer, President and Chairman of the Board. The Company appointed Mr. Gulati to the Board of Directors
and to the positions of Chief Executive Officer and President.


Effective August 1, 2005,
the Companys India subsidiary entered into an agreement to lease certain premises for certain of the Companys India operations from iLABS Hyderabad
Technology Center Pvt. Ltd. (iLabs), a related party. The terms of the lease
agreement provide for, among other things: (i) a minimum lease period of five
years with an option for two three-year renewal periods; (ii) payment of a security
deposit
in the amount of 15,282,000 Indian rupees (approximately $352,000); (iii) payment of monthly lease fees in the amount of 1,698,000 Indian rupees (approximately $40,000), subject to yearly five percent (5%) escalation; and (iv) monthly
operations and maintenance fees of 283,000 Indian rupees (approximately $6,500).


On September 30, 2005,
the Company and the Bank executed the Sixth Amendment to the Loan Documents and
Waiver Agreement. See Note 3 to consolidated financial information
included
in Item 1 of this report.


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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Overview

In
      this Section, the Company will discuss the following: (i) the restatement
      of the Companys prior period consolidated financial statements; (ii) key factors
in evaluating the Companys financial performance; (iii) application of critical accounting policies, which explains the accounting policies necessary to understand how the Company records its financial information; (iv)  forward looking
statements; (v)  results of operations - consolidated, in which the Companys
consolidated results are compared year to year to recognize trends; (vi) results
of operations by business segment, which allows the Company to compare the results
of
its different business units; and (vii) liquidity and capital resources.


Restatement of
Prior Periods Consolidated Financial Statements

The historical financial information for the three months ended March 31, 2004 included in this document has been restated. In September 2004, the Company
discovered unreconciled differences in intercompany accounts and certain other accounting errors in prior periods which resulted in adjustments to revenues, the cumulative currency translation adjustment account and accumulated deficit. As a result,
the Company's Audit Committee concluded that the Company's previously issued consolidated financial statements for the years ended December 31, 2003, 2002 and 2001, as well as all quarterly periods beginning January 1, 2001, through the quarter
ended March 31, 2004 should no longer be relied upon.


Due
      to the volume of transactions underlying the proposed adjustments and the
      Companys engagement of a new independent registered public accounting firm as of
November 1, 2004, the Company decided, in consultation with its new independent registered public accounting firm, to re-audit its consolidated financial statements for the years ended December 31, 2003 and 2002 and to re-review the quarterly
periods included therein and the quarterly period ended March 31, 2004. See Note 1 to the consolidated financial information included in Item 1 of this report for information regarding the effects of the restatement on the Companys
operating results for the quarter ended March 31, 2004. Also see Form 10-K for
the year ended December 31, 2004 for the complete detail of the restatements.


Key Factors in
Evaluating the Companys Financial Performance

Management
      believes the following factors should be considered when evaluating the
      Companys reported financial information contained in Management's
Discussion and Analysis of Financial Condition and Results of Operations.


Revenue

The majority of the Company's revenue is derived from professional services rendered to customers. Revenue is typically recognized as services are performed. The
Company's services range from providing customers with a single consultant to multi-personnel full-scale projects. Although the Company has contracts with many of its customers to provide its services, in general, such contracts are terminable upon
relatively short notice, typically not more than 30 days. There can be no assurance that the Company's customers will continue to enter into contracts with the Company or that existing contracts will not be terminated. The Company provides its
services either directly to end-user organizations, or as a member of a consulting team assembled by another IT consulting firm. Where contractual provisions permit, customers also are billed for reimbursement of expenses incurred by the Company on
the customers' behalf.


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Fixed Price Projects

The Company has provided services on certain projects in which it, at the request of the clients, offers a fixed price for its services. For the three months ended
March 31, 2005 and 2004, revenue derived from projects under fixed price contracts represented approximately 42% and 45%, respectively, of the Company's total revenue. No single fixed price project was material to the Company's business during 2005
or 2004. The Company believes that, as it pursues its strategy of providing application management services to customers, it will continue to offer fixed price projects. The Company believes that there are certain risks related to fixed price
arrangements and thus prices such arrangements to reflect the associated risk. There can be no assurance that the Company will be able to complete such projects within the fixed price timeframes. The failure to perform within such fixed price
contracts, if entered into, could have a material adverse effect on the Company's business, financial condition and results of operations.


Customer Concentration

The
      Company has derived and believes that it will continue to derive a significant
      portion of its revenue from a limited number of customers and projects.
      For the three months ended March 31, 2005 and 2004, the Company's ten largest
      customers accounted for in the aggregate approximately 49% and 47% of its
      revenue, respectively. During the three months ended March 31, 2005 one
    customer accounted for 10% or more of revenue. During the three months ended
    March 31, 2004, no single customer accounted for 10% or more of revenue.
    For the three months ended March 31, 2005 and 2004, 12% and 28%, respectively,
    of
    the Company's
    revenue
    was
    generated
      by providing supplemental resources directly to the end-customer or as
      part of a consulting team assembled by another IT consulting firm. There
    can be no assurance that such IT consulting firms will continue to engage
    the Company in the future at current levels of retention,
      if at all.


Software Partners

For the three months ended March 31, 2005 and 2004, the Company derived the following percentages of total revenue from projects in which the Company implemented,
extended, maintained, managed or supported software developed by SAP, PeopleSoft and Oracle.


|           | Percentage
    of Revenue |  
|---------- | ------------------------- | -
|           |                           |  
|           | Three Months Ended        |  
|           | March 31, 2005            |  
|           |                           |  
|           |                           |  
|SAP        | 74                        | %
|PeopleSoft | 18                        | %
|Oracle     | 2                         | %

Markets

The Company currently serves the United States market with its headquarters in Edison (New Jersey), and branch offices in Atlanta (Georgia), Warrenville (Illinois)
and Pleasanton (California). The Company also maintains local offices to serve the markets in India, the United Kingdom, Denmark and Japan. The Company leases its headquarters in Edison, New Jersey. Such lease has an initial term of ten (10) years,
which commenced in September 1998.


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Expenses

The Company's most significant cost is project personnel expenses, which consist of consultant salaries, benefits and payroll-related expenses. Thus, the Company's
financial performance is based primarily upon billing margin (billable hourly rate less the cost to the Company of a consultant on an hourly basis) and personnel utilization rates (billable hours divided by paid hours).


Application of Critical Accounting Policies

The preparation of the Companys condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States
of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of
revenues and expenses during the reporting period.  The Companys estimates, judgments and assumptions are continually evaluated based on available information and experience.  Because of the use of estimates inherent in the financial reporting
process, actual results could differ from those estimates.


Certain of the Companys accounting policies require higher degrees of judgment than others in their application.  These include revenue recognition and
allowance for doubtful accounts, impairments and estimation of useful lives of long-term assets, income tax recognition of current and deferred tax items and accruals for contingencies.  In addition, the footnotes to the Consolidated Financial
Statements include further discussion of its significant accounting policies.


The accounting policies and estimates used as of December 31, 2004, as outlined in our previously filed Form 10-K, have been applied consistently for the three
months ended March 31, 2005.


Forward Looking Statements

This Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including, without
limitation, statements regarding the Company's intention to shift more of its focus towards the management and support of customers' enterprise, e-commerce and m-commerce applications. Such forward-looking statements are subject to risks and
uncertainties, including, but not limited to:


| | • | the
          Companys ability to remediate its material weaknesses in its
          internal control over financial reporting and to continue to improve
          its control environment in order to effectively manage the business
          and to timely record, process, summarize and report financial statements
          that fairly
present, in all material aspects, the Companys financial condition, statements
of operations and cash flows;                            
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | compliance
          with the Sarbanes-Oxley Act of 2002, including without limitation Section
          404, and other regulations may be costly, time consuming and may divert
      management attention from managing ongoing business operations;                                                                                                                                                                                                                                     
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
          Companys ability to manage and grow the business in light of
          the executive and Board level turnover and the associated loss of historical
      knowledge and experience;                                                                                                                                                                                                                                                                                         
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
      Companys ability to manage increasing compensation costs for its
      existing and prospective India employees which is driven by the increasing
      demand for global delivery and competition for skilled, experienced information
      technology personnel in the India market. The Company expects that such
      compensation costs will continue to increase in the future, and any such
      increases could adversely affect the Companys results of operations;

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| | • | the
        Company's ability to attract and retain a sufficient number of highly
        skilled employees including, but not limited to, concerns regarding the
        Companys financial condition, competition from departing executives
        and competition for employees in India which may cause increasing compensation
        for existing and prospective employees, and the continued ability to
        use stock options to compensate such highly skilled employees in light
        of pending changes in
accounting rules related to stock options;                                                                                                                                    
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Companys ability to manage the transition to a new Chief Executive
        Officer without a significant disruption
in business;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Companys ability to continue to generate new business given the
        turnover in the Companys sales managers
and personnel;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Companys ability to maintain compliance with the financial and
        other covenants in its credit facility and thereby continue its access
        to its line of credit or in the event of default the Companys ability
        to negotiate a waiver with the Bank which may be unavailable or if available
    may only be on terms disadvantageous to the Company;                                                                                                                                                                                                                                                                                                                       
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Companys reliance on continued borrowing availability under the
        credit facility with the Bank as its sole source of external financing
        and the cash generated by its operating activities to fund its ongoing
        operations and growth. However, in the event such borrowing is not available
        or the Company is unable to timely collect cash from its customers, the
        Company may be forced to secure alternate financing to operate the business
        and such financing may be unavailable and, if available, may be available
        only on
disadvantageous terms to the Company;                                                                   
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Companys ability to obtain an extension of its existing credit
        facility beyond May 31, 2006 or to secure an alternate credit facility
        either of which may be unavailable or if available may only be available
        on terms disadvantageous to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                  
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        uncertainty surrounding the technology consulting outsourcing market
    and revenues derived from such market;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        continued availability of a market in which the Companys securities
    may be traded;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Company's ability to cause its Common Stock to be listed on a national
    stock exchange and the ability
    to comply with ongoing listing requirements;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Company's reliance on continued relationships and business associated
        with SAP America and Oracle, including, but not limited to, the continued
        uncertainty relating to Oracles integration of PeopleSoft into
        its product offerings and the affect that this may have on general market
        acceptance of PeopleSofts products and, accordingly, its ability
        to continue to sell professional consulting services relating to PeopleSoft
    applications;                                                                                                                                                                                                 
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        Company's limited operating history within the outsourcing line of
business;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | the
        substantial variability of the Company's quarterly operating results
    caused by a variety of factors, many of which are not within the Company's
        control, including (i) patterns of software and hardware capital spending
        by customers, (ii) IT outsourcing trends, (iii) the timing, size and
        stage of projects, (iv) timing and impact of acquisitions, (v) new service
        introductions by the Company or its competitors and the timing of new
        product introductions by the Company's ERP partners, (vi) levels of market
        acceptance for the Company's services,
(vii) general economic conditions and (viii) the hiring of additional staff;
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | • | increased
        competition in the industry may, among other negative effects, cause
    a decrease in the Company's billing and employee utilization rates;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

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| | • | uncertainty
        relating to worldwide currency exchange rates particularly in regard
        to the Indian rupee, U.S. Dollar, the Euro, British Pound and Japanese
        Yen, and the effect that fluctuations in such exchange rates may have
        on the Companys
quarterly and/or annual financial results                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        Company's ability to manage its business effectively, which will require
        the Company: (i) to continue developing and improving its operational,
        financial and other internal systems and controls, as well as its business
        development capabilities, (ii) to attract, train, retain, motivate and
        manage its employees, (iii) to continue to maintain high rates of employee
        utilization at profitable billing rates, (iv) to successfully transition
        certain operations and executive functions; (v) to successfully integrate
        the personnel and businesses acquired by the Company, (vi) to maintain
        project quality, particularly if the size and scope of the Company's
        projects increase, (vii) to properly plan, price and deliver fixed bid
        projects and service level based agreements within the requisite timeframes
        and quality levels and (viii) to reorganize its internal structure and
        personnel and to improve its processes without suffering a loss in business
    momentum;
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
    potential for future legislation regulating or taxing outsourcing;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
    Companys substantial reliance on key customers and large projects;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        Companys ability to manage fixed price projects effectively and
    efficiently;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        potential for significant claims against the Company relating to its
    professional services from
        customers
        or otherwise and the inability of the Company to adequately mitigate
    the risk of such potential claims;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        potential risks and penalties associated with the ongoing investigation
        by the United States Securities and Exchange Commission (SEC)
        related to the Companys restatement of prior periods consolidated
    financial statements;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        Companys ability to defend itself and resolve the ongoing shareholder
        litigation related to the Companys restatement of prior periods consolidated
        financial statements within the limits of the Companys director
    and officer liability insurance policy;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        Company's ability to successfully address the continuing changes in IT,
        evolving industry standards
        and changing customer
objectives and preferences;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
    Company's reliance on the continued services of its key technical personnel;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
        continued uncertainty relating to the current geopolitical climate, particularly
        relative to internal
        India politics and their relation to Indias continuing efforts
        to liberalize its economy and be receptive to economic conditions and
        policies favorable to the Companys
business model;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | the
    Company's ability to protect its intellectual property rights; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | • | uncertainties
        resulting from pending litigation matters and from potential administrative
        and regulatory
        issues including, but not limited to, accounting, corporate governance,
    immigration and taxation matters.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

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In addition,
in July 2000, the Company completed the tax-free spin-off of SeraNova, its former
subsidiary. In March 2001, SeraNova and Silverline Technologies Limited (“Silverline”)
consummated  the acquisition of SeraNova by Silverline. Had the acquisition of
SeraNova by Silverline been contemplated at the time of the spin-off, the spin-off
would have been a taxable transaction. SeraNova's management has represented
that such acquisition
was not contemplated at the time of the spin-off of SeraNova by the Company,
and accordingly should not impact the tax-free nature of the spin-off. Although
the Company and SeraNova are parties to a tax sharing agreement pursuant to which
SeraNova  agreed to indemnify the Company with respect to any possible tax liability
related to the spin-off, SeraNova has filed for bankruptcy protection under Chapter
7 of the United States Bankruptcy Code and would be unable to pay the resultant
tax
liability pursuant to SeraNova's indemnification obligations under its tax sharing
agreement with the Company. If it were determined that the spin-off was taxable,
the Company would bear the liability to pay such the tax liability, which would
be  material. Please refer to Note 7 to the unaudited condensed consolidated
financial
statements
of the Company included elsewhere in this report for further information.


As a result of these factors and others, the Companys actual results may differ materially from the results disclosed in such forward-looking statements.


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Results
of Operations – Consolidated

The following table sets forth for the periods indicated certain financial data expressed as a percentage of total revenue:


|                                             | Percentage of Revenue        |   
|-------------------------------------------- | ---------------------------- | --
|                                             |                              |   
|                                             | Three Months Ended March 31, |   
|                                             |                              |   
|                                             | 2005                         |   
|                                             |                              |   
|                                             |                              |   
|Revenue                                      | 100.0                        | % 
|Cost of revenue                              | 74.9                         |   
|                                             |                              |   
|Gross profit                                 | 25.1                         |   
|                                             |                              |   
|Selling, general and administrative expenses | 26.0                         |   
|Depreciation and amortization                | 1.3                          |   
|                                             |                              |   
|Total operating expenses                     | 27.3                         |   
|                                             |                              |   
|Operating income (loss)                      | (2.2                         | ) 
|Interest income                              | 0.1                          |   
|Interest expense                             | (0.2                         | ) 
|Other expense                                | (0.7                         | ) 
|                                             |                              |   
|Income (loss) before income tax benefit      | (3.0                         | ) 
|Income tax benefit                           | (0.9                         | ) 
|                                             |                              |   
|Net income (loss)                            | (2.1                         | )%
|                                             |                              |   

Three Months Ended March 31, 2005 Compared to Three Months Ended March 31, 2004 (Restated)


The following discussion compares the consolidated results of operations for the three months ended March 31, 2005 and 2004.


Revenue.
      Total revenue increased by 6.2%, or $1.9 million, from $30.5 million

for the three months ended March 31, 2004 to $32.4 million for the three
months ended March 31, 2005. The increase was attributable primarily to growth
in revenue generated in India (by approximately $2.0 million). The revenue
growth in  India results directly from the increased demand in the US from existing
customers for the Companys offshore services, including traditional consulting
service offerings, application management and support services, and offshore
development
services.


Cost
        of revenue and gross profit.
        The Company’s cost of revenue increased by 17.6%, or
$3.6 million, from $20.7 million for the three months ended March 31,
2004, to $24.3 million for the three months ended March 31, 2005 due primarily
to the increase in headcount and compensation costs for consultants. The Company's

gross profit decreased by 17.2%, or $1.7 million, from $9.9 million for
the three months ended March 31, 2004, to $8.2 million for the three months
ended March 31, 2005. Gross margin decreased to 25.0% for the three months ended
March  31, 2005, from 32.3% for the three months ended March 31, 2004. The decrease
in gross profit and gross margin primarily results from an increase in headcount,
compensation costs and certain project related expenses. The Company expects
lower gross margin for the full year of 2005.


Selling,
        general and administrative expenses.
        Selling, general and administrative  expenses primarily consist of salaries,
        and related benefits costs for sales and general administrative personnel,
        occupancy costs, travel and entertainment and professional fees. Selling,
        general and administrative expenses remained relatively
constant at $8.4 million for the three months ended March 31, 2005 and 2004,
respectively, and decreased as a percentage of revenue to 26.0% from 27.8%, respectively.
The decrease in selling, general and administrative expenses, as a percentage
of revenue, was related primarily to the increase in revenues, while expenses
remained constant.


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Depreciation and amortization. Depreciation and amortization expenses decreased to
$437,000 for the three months ended March 31, 2005, compared to $469,000 for the three months ended March 31, 2004. The decrease was due to certain fixed assets becoming fully depreciated during 2004.


Interest income. The Company earned $16,000 in interest income for the three months
ended March 31, 2005, compared with $17,000 for the three months ended March 31, 2004.  The interest income is related primarily to certain interest-bearing bank accounts in India and Japan.


Interest expense.The Company incurred $73,000 and $106,000 in interest expense
for the three months ended March 31, 2005 and 2004, respectively, related to borrowings under its credit facility. Borrowings under the credit facility were used primarily to fund operating activities.  The decrease in interest expense results from
lower average outstanding borrowings under the line of credit during 2005.


Other
        income (expense).Other
        income (expense) results primarily from foreign currency transaction
        gains or (losses) associated with changes in foreign currency exchange
        rates.
        The Company
        reported
        other expense of $219,000 and $635,000 for the three months ended
        March 31, 2005 and 2004, respectively. The change results from foreign
        currency fluctuations, primarily in the UK and Denmark.


Income
        tax provision (benefit).
        The Company recorded tax benefit of $307,000 and
$191,000 on pretax income (loss) of $(998,000) and $187,000 for
the three months ended March 31, 2005 and 2004. The tax benefit of $191,000
for March 31, 2004 consisted principally of foreign income tax liability in certain
foreign  tax jurisdictions reduced by state and local income tax claims for refund
and the recognition of deferred income tax benefits from its India operations.
For the three months ended March 31, 2005 the overall tax benefit of $307,000
consisted  primarily of state and local income taxes reduced by the recognition
of deferred and income tax benefits recorded at our India and Japan operations.


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Results of Operations by Business Segment

The Company operates in one industry segment, information technology solutions and services.


The Company has four reportable geographic operating segments which are organized and managed on a geographical basis, as follows:


| | • | United
          States (“US”)  the largest segment of the Company,
          with operations in the United States
          and Puerto Rico. Includes the operations of the Company's US subsidiary,
          Empower, Inc.,
          and all corporate functions and activities. The US and corporate headquarters
    is located in Edison, New Jersey;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                              
| | • | India  includes
          the operations of the Company in India, including services provided
          on behalf
          of other Company subsidiaries, primarily to the US. The Indian headquarters
          is located
    in Hyderabad, India;                                                                                                       
| |   |                                                                                                                                                                                                                                                                                                                                                              
| | • | Europe  includes
          the operations of the Company in Denmark, Sweden and the United Kingdom.
          However, the Company transitioned its operations in Sweden to Denmark
          as of January
          1, 2003. The European headquarters is located in Milton Keynes, United
    Kingdom; and                                               
| |   |                                                                                                                                                                                                                                                                                                                                                              
| | • | Japan  includes
          the operations of the Company in Japan. The Japanese headquarters is located
    in Tokyo, Japan.                                                                                                                                                                                                                                 

Each of the geographic segments has a Managing Director, or manager with an equivalent position, who reports directly to the Chief Executive Officer (CEO).
Currently, the CEO is fulfilling the requirements of this position in the US. The CEO has been identified as the Chief Operating Decision Maker (CODM) because he has final authority over resource allocation decisions and performance
assessment. The CODM regularly receives certain discrete financial information about the geographical operating segments, including primarily revenue and operating income, to evaluate segment performance.


Three Months Ended March 31, 2005 Compared to Three Months Ended March 31, 2004 (Restated)


The following discussion compares the segment results of operations for the three months ended March 31, 2005 and the three months ended March 31, 2004.


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Revenue. The following table displays revenues by reportable segment (in thousands).


|              |   | Three Months Ended March 31, | 
|------------- | - | ---------------------------- | 
|              |   |                              | 
|              |   | 2005                         | 
|              |   |                              | 
|              |   |                              | 
|              |   | Amount                       | 
|              |   |                              | 
|United States | $ | 22,893                       | 
|India         |   | 6,791                        | 
|Europe        |   | 1,950                        | 
|Japan         |   | 802                          | 
|              |   |                              | 
|Total         | $ | 32,436                       | 
|              |   |                              | 

US
      revenue marginally decreased by 2.2%, or $0.5 million, from $23.4
      million for the three months ended March 31, 2004 to $22.9 million
      for the three
months ended March 31, 2005.


India revenue
    increased by 62.3%, or $2.6 million, from $4.2 million for the three
    months ended March 31, 2004, to $6.8 million for the three months
ended March 31, 2005. The increase was attributable primarily to increased demand
    for offshore services in the United States. A majority of the revenue generated
    in India is derived from providing offshore development and support services
    to
customers sourced through the Companys affiliated entities in other parts
of the world, but most predominantly with the United States. While the Company
expects further revenue growth from its Indias operations, it
does
not
expect
to
continue to
see similar increases in percentages through the remainder of 2005.


Europe revenue marginally decreased by 6.2%, or $0.1 million, from $2.1 million for the three months ended March 31, 2004, to $2.0 million for the three
months ended March 31, 2005.


Japan revenue
    marginally decreased by 7.2%, or $0.06 million, from $0.9 million
    for the three months ended March 31, 2004, to $0.8 million for the three

months ended March 31, 2005.


Operating Income (Loss).  The following table displays operating income (loss) by
reportable segment (in thousands).


|              | Three Months Ended March 31, |       
|------------- | ---------------------------- | ------
|              |                              |       
|              | 2005                         |       
|              |                              |       
|United States | $                            | (1,592
|India         |                              | 1,205 
|Europe        |                              | (148  
|Japan         |                              | (187  
|              |                              |       
|Total         | $                            | (722  
|              |                              |       

US operating
    performance decreased by $1.7
      million, from operating income of $0.06 million for the three months
      ended March 31, 2004, to an operating loss
of $1.6 million for the three months ended March 31, 2005.  The decrease
in operating income was primarily related to the increased general and administrative
costs associated with accounting and legal fees incurred in connection with restating
and re-auditing prior period financials and other legal fees incurred.


India operating income increased by $0.7 million, from $0.5 million for the three months ended March 31, 2004, to $1.2 million for the three months
ended March 31, 2005. The increase was attributable primarily to an increase in demand for offshore services.


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Europe operating performance decreased by $0.4 million from operating income of $0.2 million for the three months ended March 31, 2004, to operating losses
of $0.2 million for the three months ended March 31, 2005. The decrease was attributable primarily to increased project related costs.


Japan operating performance decreased by $0.3 million, from operating income of $0.1 million for the three months ended March 31, 2004, to operating losses
of $0.2 million for the three months ended March 31, 2005. The decrease was attributable primarily to an increase in payroll costs.


Liquidity and Capital Resources

Cash Flows

The Company had cash and cash equivalents of $7.1 million at March 31, 2005 and $6.2 million at December 31, 2004.  The Company had working capital of
$19.3 million at March 31, 2005 and $20.0 million at December 31, 2004.


Cash used
    in operating activities was $2.3 million for the three months ended
    March 31, 2005, resulting primarily from the net loss of $0.7 million, increases
    in accounts receivable ($3.3
    million), and decreases in accounts payable ($0.5
    million) and
accrued payroll ($0.4 million), offset by
an increase in other current assets ($0.9 million), and decreases
in income taxes payable ($0.4 million) and accrued expenses and other liabilities
($1.1 million).


The Company invested $137,000 and $34,000 in computer equipment, internal-use computer software and office furniture and fixtures during the three months
ended March 31, 2005 and 2004, respectively. The increase results primarily from the replacement of computer equipment and the development of certain internal-use software.


Compliance with Loan Agreement

On May 31,
    2000, the Company and the Bank entered into a three-year revolving credit
    facility (the credit facility). In July 2003, the credit facility
     was extended until May 31, 2006. The credit facility is currently comprised
    of a revolving line of credit pursuant to which the Company could borrow
    up to $15.0 million  at the Bank's prime rate per annum. The credit
    facility is collateralized by substantially all of the assets of the Company's
    United States based operations. The  maximum borrowing availability under
    the line of credit is based upon a percentage of eligible billed and unbilled
    accounts receivable, as defined.


As of March 31, 2005,
the Company was in default under its credit facility as a result of the Companys
failure to timely deliver to the Bank certain monthly reporting schedules, monthly
 financial statements, quarterly financial statements, and annual statements
during 2004 and 2005. In addition as of April 4, 2005, the Company was also in
default under its credit facility as a result of the Companys removal of
Arjun Valluri  as Chief Executive Officer and President. The Company secured
waivers of such defaults under terms of the Sixth Amendment to the Loan Document
and Waiver Agreement (the Sixth Amendment). The terms of the Sixth
Amendment amend the Loan  Documents currently as follows: (i) to prevent the
Company from electing to borrow, convert to or continue a Eurodollar Rate Loan
and to provide that all Advances bear an interest rate per annum equal to the
Base Rate (as such term is defined in the
Credit Agreement); (ii) to define Change in Management as any change
in the Companys Chief Executive Officer or Chief Financial Officer, which
is not acceptable to the Bank; (iii) to define Revolving Interest Rate as

interest rate per annum equal to the Base Rate; (iv) to define Undrawn
Availability to include the redemption value of a specified bank account
in the calculation of Undrawn Availability; and (v) to add an early termination
fee in an  amount equal to one-half of one percent (.50%) of the maximum revolving
advance amount. Under the terms of the Sixth Amendment, among other things, the
Company was required to deliver draft, unaudited financial statements to the
Bank on or before
September 30, 2005 and to deliver audited annual financial statements to the
Bank on or before October 15, 2005. The Company has satisfied each of these two
requirements.


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The Company also agreed to resume timely filing of the periodic reports due to the listing exchange upon which the Companys shares are traded and to any governmental agency beginning with
the filing of the Companys annual report on Form 10-K for the year ending December 31, 2005. The Bank agreed to waive any events of default arising from the Companys failure to timely deliver to the Bank the monthly reporting schedules,
monthly financial statements, quarterly financial statements and annual financial statements and the Companys removal of Arjun Valluri from his position as Chief Executive Officer and President.


Cash to Fund Operating Activities

The Company relies on the cash generated by operating activities and the financing
  available under its credit facility to fund ongoing operations. The Company’s
  credit facility with the Bank represents the sole source of external financing
  for ongoing business operations. The Company’s operating plan depends
  on continued borrowing availability under this credit facility or securing
  alternate sources of financing. The Company must comply with certain covenants
  or secure from the Bank waivers of its default on such covenants to maintain
  its line of credit with the Bank. Given the Company’s variable operating
  performance in the past few years, there can be no assurances that the Company
  will be able to maintain compliance with its bank covenants or obtain waivers
  of any defaults. In addition, there can be no assurances that the Company will
  be able to secure alternate sources of financing to fund its operations or
  that such financing will be available on terms that are advantageous to the
  Company. Furthermore, the Company’s credit facility shall expire on May
  31, 2006. There can be no assurance that the Company will be able to secure
  an extension of its existing credit facility beyond May 31, 2006 or to secure
  an alternate credit facility to fund its operations or that such extension
  or alternate credit facility will be available on terms that are advantageous
  to the Company.


The Company's 2005 operating plan contains assumptions regarding revenue and expenses. The Companys significant cash requirements for 2005 include operating
expenses, capital investments in infrastructure for its Indian operations amounting to approximately $2
million, and legal and professional fees including but not limited to, the costs
incurred as part of the restatement and re-audit process, costs incurred in complying
with Section 404 of the Sarbanes Oxley Act of 2002 and legal fees incurred in
connection with the Shareholder Class Actions and SEC investigation. The achievement
of the operating plan depends heavily on the timing of
work performed by the Company on existing projects and the ability of the Company
to gain and perform work on new projects. Project cancellations, delays in the
timing of work performed by the Company on existing projects or the inability
of the Company to gain and perform work on new projects, or ability to timely
collect cash from its customers could have an adverse impact on the Company's
ability to execute its operating plan and maintain adequate cash flow. In the
event actual results
do not meet the operating plan, management believes it could execute contingency
plans to mitigate such effects. Such plans include additional cost reductions
or seeking additional financing. In addition, the Company may seek additional
financing from time to time for general corporate purposes, provided however
that the availability of financing may be limited because the Company is not
currently listed on a national stock exchange. Considering the cash on hand, the availability under the credit facility,
and assuming the extension of the existing credit facility or securing alternate
financing prior to the expiration of the existing credit facility in May 2006,
the achievement of the operating plan and management's actions taken to date,
management believes that it has the ability to continue to generate sufficient
cash to satisfy its operating requirements in the normal course of business,
and that its available credit arrangements and the cash flow expected to be generated
from operations will be adequate to satisfy its current and planned operations
through at least the next twelve months.


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Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Although the Company cannot accurately determine the precise effect thereof on its operations, it does not believe inflation, currency fluctuations or interest rate changes have historically
had a material effect on its revenues or results of operations. Any significant effects of inflation, currency fluctuations and changes in interest rates on the economies of the United States, Asia and Europe could adversely impact the
Companys revenues and results of operations in the future. If there is a material adverse change in the relationship between European currencies and/or Asian currencies and the United States Dollar, such change would adversely affect the
result of the Companys European and/or Asian operations as reflected in the Companys condensed consolidated financial statements. The Company has not hedged its exposure with respect to this currency risk as of March 31, 2005, but
intends to review its exposure on a quarterly basis, and using a cost-benefit analysis, determine whether it should enter into arrangements to mitigate this risk.


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Item 4. Controls and Procedures.

Disclosure
  Controls and Procedures

The Company is responsible for maintaining disclosure controls and procedures designed to ensure that information required to be disclosed in its Exchange Act reports is recorded, processed,
summarized and reported within the time periods specified in the Securities Exchange Commissions rules and regulations, and that such information is accumulated and communicated to its management, including its chief executive officer and
chief financial officer, as appropriate, to allow for timely decisions regarding required disclosure.


In designing and evaluating the Companys disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide
only reasonable assurance of achieving their objectives and management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures and implementing controls and procedures based upon
the application of managements judgment.


The Companys management, with the participation of the Companys Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Companys disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon this evaluation, the Companys Chief Executive Officer and Chief Financial Officer
concluded that the Companys disclosure controls and procedures were not effective to ensure that information required to be disclosed in the reports the Company files or submits under the Exchange Act is recorded, processed, summarized, and
reported, within the time periods specified in the SECs rules and regulations, due to the material weaknesses disclosed in our 2004 annual report on Form 10-K for the year ended December 31, 2004, filed on October 24, 2005, which are discussed
below under the heading material weaknesses.


Material Weaknesses:

A material weakness is
a significant deficiency (as defined in Auditing Standard No. 2), or a combination
of significant deficiencies, that results in there being more than a remote likelihood
that a material misstatement in annual or interim financial statements will not
be
prevented
or
detected. As part of its assessment of internal control over financial reporting
that was included in its
annual report on Form 10-K for the year ended December 31, 2004, filed on October
24, 2005, management has identified the following material weaknesses in its
internal control over financial reporting as of December 31, 2004. Although the
Company believes that it made substantial progress in remediating these material
weaknesses, it cannot determine which, if any, had been remediated as of March
31, 2005, and it will not be able to determine whether such weaknesses have been
completely
remediated until it completes its year-end testing and assessment of
internal control over financial reporting for 2005 and its independent registered
public accounting firm has audited such assessment.


| | • | Accounting
            and Finance Personnel Weaknesses The
            Company had insufficient resources to perform the accounting and financial
            reporting functions and such resources lacked the appropriate level
            of accounting knowledge, experience and training in the application
            of generally accepted accounting
            principles and were inadequately supervised. The lack of sufficient
            and adequately trained accounting and finance
            personnel resulted in an ineffective segregation of duties relative
            to key
            financial reporting functions. These in turn caused a lack of senior
            level review and oversight over
            key accounting decisions and resulted in errors in both the entry
            of financial information and in the preparation of consolidated
            financial statements. Furthermore the Company experienced significant
            turnover in finance and accounting personnel during 2004 and the
            Company lacked adequate
            transition and knowledge transfer processes which resulted in the
            loss of a significant amount of historical knowledge related to the Companys
            business and its prior accounting practices, processes
    and policies.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|• | Accounting
            Policies and Procedures Weaknesses-
            The Company had inadequate documentation regarding the appropriate application
            of generally accepted accounting principles, as well inadequate documentation
            regarding the
Companys accounting policies and procedures and the application of those
policies and procedures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|• | Weaknesses
            Related to Implementation of ERP System The
            Company failed to adapt its accounting and business processes to conform
            to the requirements of the Companys new ERP system and provided
            insufficient training of its finance and accounting personnel on
            the functionalities of the ERP
    system prior to the Companys April 1, 2004 go-live date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|• | Weaknesses
            Related to Record Retention-
            Inadequate record retention polices and procedures caused a failure to obtain,
            retain and safeguard key documents and narratives necessary to provide supporting
            documentation for how the
Company recorded transactions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|• | Closing
            and Consolidation Procedures-
            Management identified deficiencies in the analysis and reconciliation of certain general
            ledger accounts. Specifically, accounting personnel did not perform timely
            reconciliations and did not properly resolve reconciling items for
            the inter-company accounts, foreign
            currency translation adjustment account, unbilled revenues, deferred
            revenues, payroll accounting, vacation accrual
            and fixed assets. Unreconciled differences in the Companys
            inter- company
            accounts were improperly recorded as changes to the currency translation
            account, which resulted
            in misstatements of revenue, foreign currency translation adjustments
            and retained earnings.In
            addition, there were deficiencies in the analysis and reconciliation
            of intercompany accounts in connection
with the charges
reported as a result of the divestiture of the Companys Asia-Pacific operations,
which resulted in misstatements of the charges in connection with the loss recorded
for thedivestitureof the Companys
Asia-Pacific operations. Finally, there were inadequate controls over
the consolidation process for
the Companys international subsidiaries.
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|• | Inadequate
            Controls Over Income Tax Accounting -The
            Company had ineffective controls over the determination and reporting
            of the provision for income taxes and related prepaid income taxes, income
            taxes payable and deferred income tax asset and liability balances.
            As a result, prepaid income
            taxes, income taxes payable, deferred income tax assets and liabilities
            and retained earnings were not properly recorded in
            accordance with accounting principles generally accepted in the United
    States of America.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|• | Lack
            of an Effective Internal Audit System-
            The Company had an inadequately staffed, inadequately trained and inexperienced internal
            audit department, which was ineffective in preventing and detecting
            control lapses and errors in the accounting of certain key areas
            like revenue recognition, inter-company
            reconciliations, fixed assets, currency translation adjustments,
            vacation accrual and income taxes, which resulted
    in misstatements in prior period consolidated financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

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Remediation Plan regarding the Material Weaknesses

Management is actively
  engaged in remediation efforts to address the material weaknesses identified
  in the Companys internal control over financial reporting as of December 31, 2004. These
  on-going remediation efforts, outlined below, are specifically designed to address the material weaknesses identified by management and to improve and strengthen the Companys
  overall control environment.


| | • | During
          the fourth quarter of 2004, the Company appointed a new Chief Financial
          Officer and began to
          centralize and reorganize its finance organization to create a unified
          global finance team with responsibility
          for the accounting and financial reporting functions for the Company
    and each of its subsidiaries worldwide.                                                                                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | During
          the fourth quarter of 2004, the Company began to redesign and more
          fully document its business
          processes, policies, and procedures related to record retention, closing
          and consolidation procedures,
          income tax accounting, internal audit and other key financial reporting
    functions.                                                                                                                                                                                                                   
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | In
          connection with redesigning its business process, policies and procedures
          the Company strengthened
          senior level oversight related to key financial reporting functions
          by designating an approval
    process which required approvals from senior finance management personnel.                                                                                                                                                                                                                                             
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | The
          Company has reallocated
resources and added personnel to the Companys finance and accounting
staff to strengthen the accounting function and reorganized the accounting function
to provide for
increased segregation of duties.                                                                                                                                                                                                                                                                                                                         
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | The
          Company trained and cross-trained its finance and accounting personnel
          in multiple functions and
          processes related to financial reporting. The Company is implementing
          a series of training programs
          to educate its finance and accounting personnel regarding the Companys
          internal control standards, with a particular
          emphasis on the Companys accounting policies and procedures,
          record retention,
          closing and
consolidation procedures and income tax accounting.
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | In
          2005, the Company strengthened its internal audit function by re-establishing,
          and allocating additional
          resources to, its Internal Assurance Department redefining its scope,
    and reinforcing its mandate.                                                                                                                                                                                                                                                                                                                        
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | The
          Company confirmed and communicated its revenue recognition polices
    to its global accounting teams.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | The
          Company implemented
the Asset Accounting module, and is in the process of implementing Materials
Management module and SEM BCS (Strategic Enterprise Management Business Consolidation) module,
within its ERP system, to strengthen the control environment
surrounding financial
reporting.                                                                                                                                                                                                                                                       
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | • | In
          addition to further strengthen and improve senior level oversight and
          review over key financial reporting
          decisions, the Company also implemented a process whereby each team
          members work is reviewed
          by a collective group of senior level finance personnel as at the end
    of each accounting period.                                                                                                                                                                                                       

Furthermore, in the second quarter of 2005, the Company re-engaged a nationally-recognized accounting and consulting firm to assist the Company in documenting, testing and remediating its
  internal control over financial reporting in preparation for year-end testing.  While the Company believes that it has made substantial progress in remediating the material weaknesses identified above, the Company cannot determine such weaknesses
  have been remediated until it completes its year-end testing and assessment of internal control over financial reporting for 2005 and its independent registered public accounting firm has audited such assessment.


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Procedures Adopted

To remediate the aforementioned
  material weaknesses in internal control over financial reporting, management
  adopted new procedures to ensure that the Companys consolidated financial
  statements as of and for the three months ended March 31, 2005 comply with accounting principles generally accepted in the United States of America and fairly present, in all material respects, the Companys
  financial condition as of March 31, 2005 and results of operations and cash flows
  for the three months ended March 31, 2005.


To remediate the material weaknesses impacting revenue recognition and accrual, accounts receivable, deferred revenue and unbilled revenue, the Company performed the following
  activities:


| | • | Documented
            and validated with the respective project managers the progress on
            milestone-based contracts
            and manually reviewed each percentage of completion calculation to
            validate the appropriate
      revenue recognition and accruals;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                            
| | • | Manually
            reviewed and validated the accuracy of invoices generated by ERP
      system;                                                                                                                                                                                        
| |   |                                                                                                                                                                                                                                                                                            
| | • | Manually
      reviewed, validated and approved all customer credits; and                                                                                                                                                                                                                  
| |   |                                                                                                                                                                                                                                                                                            
| | • | Collected,
            reviewed and validated the timesheets and performed monthly cut-off
            procedures to ensure
            that hours worked, and the corresponding revenue recognized, were
            recorded in the appropriate
      period.                            

To address the material weaknesses related to deficiencies in analyzing and reconciling the general ledger accounts related to payroll, the Company performed a manual review, validation and
reconciliation of the postings to the payroll control account to ensure that the accounts balanced at the end of each month.


To address the material weaknesses related to deficiencies in analyzing and reconciling intercompany account transactions, the Company


| | • | Performed
          intercompany reconciliations for all locations on a monthly basis and
          ensured that the intercompany
          balances are reflected
correctly and eliminate upon consolidation.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In addition to further
  strengthen and improve senior level oversight and review over key financial reporting
  decisions, the Company also implemented a process whereby each team members
  work is reviewed by a collective group of senior level finance personnel as at
  the end of each accounting period.


The Company continues its efforts to remediate control weaknesses and further improve and strengthen its internal control over financial reporting under the
direction of the Chief Financial Officer.


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Changes in Internal Controls

During the three months ended March 31, 2005, except for the steps taken in the ongoing efforts to remediate the material weaknesses discussed above, there was no change in the Company's
internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.


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|PART
    II. | OTHER
    INFORMATION
|------------ | ---------------------
|             |                      
|Item
    1.  | Legal
    Proceedings

India Tax Assessments

The
      Company's India subsidiary has received tax assessments dated February
      12, 2002, July 23, 2002, August 22, 2003, and December 31, 2003 from the
      India taxing authority denying tax exemptions claimed for certain revenue
      earned and disallowing certain expenses claimed during the Indian subsidiarys fiscal years ended March 31, 1998 through March 31, 2001. The revised tax assessments were for 14.6
million, 9.5 million, 2.8 million, and 5.6 million Indian rupees, respectively, or approximately $742,000 in total. An additional assessment for tax penalties and interest for the fiscal year ended March 31, 2001 of 1.7 million Indian rupees, or
approximately $39,000, was also received. The Company has made payments of approximately $815,000 (consisting of $682,000 for taxes paid under protest, $39,000 for tax penalties and interest and $94,000 for other tax adjustments
not in dispute) to the India tax authority. The Companys resulting overpayment of $34,000
has been refunded.


On
      March 29, 2005, the Companys India subsidiary received an additional revised assessment for 15.0 million Indian rupees, or approximately $345,000, for
the fiscal year ended March 31, 2002. The assessment disallowed some of the export revenue claimed by the Company and also disallowed certain expenses claimed by the Company. The Company has paid approximately 6.0 million Indian rupees, or
approximately $137,000, under protest and has also paid an additional 5.1 million Indian rupees, or approximately $118,000, for agreed-to adjustments through October 2005. The Company is currently challenging the remaining unpaid assessment
with the Commissioner of Tax Appeals but pending resolution of such appeal, the Company plans to pay the remaining $89,000
tax assessment in installments over the next 12 to 18 months as permitted by
the India tax authority.


The Company is currently at the Appellant Tribunal stage for the fiscal years ended March 31, 1998 through March 31, 2001 and at the Commissioner of Income Tax
Appeals stage for fiscal year ended March 31, 2002. All applicable amounts noted above have been paid or accrued.


Shareholder
Class Action

Six
      class action lawsuits have been initiated, purportedly on behalf of plaintiffs
      who purchased the Companys securities, against the Company and certain
       former officers, including Arjun Valluri, Nicholas Visco, Edward Carr
      and David Distel (Defendants) (collectively, Shareholder
      Class Actions) in the United States District Court, District of New
      Jersey (District of New
Jersey). In August 2005, the District of New Jersey consolidated the six
class actions (the Shareholder Class Action) and appointed a lead
plaintiff. Plaintiffs subsequently dropped Mr. Distel and Mr. Carr from the Shareholder
Class Action, failing to name either of them as a defendant in the amended consolidated
complaint filed on or about October 10, 2005. The
Shareholder
Class
Action
generally
alleges
violations
of
federal securities laws, including allegations that the Defendants made materially
false and misleading statements regarding the Companys
financial condition and that the Defendants materially overstated financial results
by engaging in improper accounting practices. The Class Period alleged is May
1, 2001 through September 24, 2004. The Shareholder Class Action generally seeks
relief in the form of unspecified
compensatory damages and reasonable costs, expenses and legal fees.


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SEC Investigation

On
      January 28, 2005, the Company received subpoenas in connection with a formal
      investigation by the Securities and Exchange Commission (SEC)
      regarding whether federal securities laws were violated in
connection with the issuance of the Companys financial statements for prior
periods. The Company is cooperating with the SEC to produce documents in response
to the subpoenas.


Broadview Claim

On or about March 23,
2005, Jefferies & Company, Inc. initiated an arbitration proceeding to recover fees in the amount of $750,000 plus interest and reasonable attorneys fees and
costs allegedly owed to Broadview International, a division of Jefferies & Company (Broadview) as a result of the private placement transaction that the Company closed on September 30, 2004 with SB Asia Infrastructure Fund, L.P. and
Venture Tech Assets Pvt. Ltd. The arbitration proceeding is in the discovery phase. In the event the Company does not prevail at the arbitration proceeding the Company will be liable for $750,000 plus interest and reimbursement of
attorneys fees and costs. There
      is no other litigation pending to which the Company is a party or to which
      any of its property is subject which would have a material impact on the
      Companys consolidated financial condition, results of operations
or cash flows in the event the Company was unsuccessful in such litigation.


|Item
    5. | Other
    Information.
|----------- | ----------------------

Nagarjun
      Valluripalli, the Companys former Chairman of the Board, President, Chief Executive Officer and a former Director of the Company is an owner (the
Owner) of real estate located at 5-9-22, Secretariat Road in Hyderabad, India. On October 2, 2003, Intelligroup Asia Private, Ltd. (IGA) and the Owner executed a memorandum of understanding (the MOA)
relating to a
proposed lease whereby the Owner would lease the 5thand 6thfloors
of the property (Premises) to the Company for certain of the Companys India operations. As contemplated in the MOA, on June 18, 2004,
the Owner and IGA executed leases for the Premises and the amenities, furnishings and fittings. The leases provide for a minimum lease period of three years with a renewal option for an additional three years. The leases provide for a three-month
notice period for either party to terminate the lease. Under the terms of the lease for the amenities, IGA paid a deposit of 5,820,000 Indian rupees (approximately $133,000) and advance lease rentals of 11,640,000 Indian rupees (approximately
$266,000) upon the handing over of the amenities and shall pay monthly rent of 1,164,000 Indian rupees (approximately $27,000). Under the terms of the lease for the Premises, IGA paid a deposit of 4,656,000 Indian rupees (approximately
$106,000) and advance lease rentals of 9,312,000 Indian rupees (approximately $213,000) upon the handing over of the Premises and shall pay monthly rent of 931,000 Indian rupees (approximately $21,000).  Prior to entering into this
transaction, the Companys Board of Directors determined that the terms and conditions were no less favorable to the Company than could be obtained from unrelated third parties. Rent expense for the three months ended March 31, 2005 towards the
said lease was 7,261,000 Indian rupees (approximately $166,000).  The value of un-amortized rentals as of March 31, 2005 was 11,524,000 Indian rupees (approximately $263,000).


Effective
      August 1, 2005, IGA entered into an agreement to lease certain premises
      for certain of the Companys India operations from ILABS Hyderabad
      Technology
Center Pvt. Ltd. (iLabs), a  party with which two members of the
Companys Board of Directors, Srini Raju and Sandeep Reddy, are affiliated.
The
terms
of
the lease agreement provide for, among other things: (i) a minimum lease period
of
five
years with an option for two three-year renewal periods; (ii) payment of a security
deposit in
the amount of 15,282,000 Indian rupees (approximately $352,000); (iii) payment
of monthly lease fees in the amount of 1,698,000 Indian rupees (approximately $40,000),
subject to yearly five percent (5%) escalation; and (iv) monthly operations and

maintenance fees of 283,000 Indian rupees (approximately $6,500).


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Item
6.   Exhibits.

| | (a) | 31.1 | Certification
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
| | --- | ---- | ----------------------------------------------------------------------------
|
| |     | 31.2 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.    
|
| |     | 32.1 | Certification pursuant to 18 U.S.C. Section 1350                            
|
| |     | 32.2 | Certification pursuant to 18 U.S.C. Section 1350                            
|

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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 9th day of November 2005.

|                       | INTELLIGROUP,
    INC.
|---------------------- | ----------------------
|                       |                       
|Date: November 9, 2005 | By:/s/                
|                       |                       
|                       |                       
|                       |                       
|Date: November 9, 2005 | By:/s/                
|                       |                       
|                       |                       

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EXHIBIT INDEX

|Exhibit No. | Description of Exhibit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2           | Agreement
          and Plan of Merger of the Company and its wholly owned subsidiary Oxford
          Systems Inc. (Incorporated by reference to the Company’s Annual Report
    on Form 10-KSB for the year ended December 31, 1996.)                                                                                                                                                                                                                                                                                                                       
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3.1         | Amended
          and Restated Certificate of Incorporation. (Incorporated by reference
          to the Company’s Registration Statement on Form SB-2 (Registration
    Statement No. 333-5981) declared effective on September 26, 1996.)                                                                                                                                                                                                                                                                                                                   
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|3.2         | Amended
          and Restated Bylaws. (Incorporated by reference to the Company’s Registration
          Statement on Form SB-2 (Registration Statement No. 333-5981) declared
    effective on September 26, 1996.)                                                                                                                                                                                                                                                                                                                                         
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|4.1         | Shareholder
          Protection Rights Agreement dated as of November 6, 1998, between the
          Company and American Stock Transfer & Trust Company which includes
          (I) the Form of Rights Certificate and (ii) the Certificate of Amendment
          to the Amended and Restated Certificate of Incorporation of Intelligroup,
          Inc. (Incorporated by reference to Exhibit No. 4.1 of the Company’s
          Report on Form 8-K dated November 9, 1998, filed with the Securities
    and Exchange Commission on November 9, 1998.)
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|4.2         | Amendment
          dated September 29, 2004 to the Shareholder Protection Rights Agreement
          dated November 6, 2004. (Incorporated by reference to Exhibit No. 4.1
          of the Companys Report on Form 8-K dated September 29, 2004,
    filed with the Securities and Exchange Commission on October 5, 2004.)                                                                                                                                                                                                                                
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|10.1*       | 1996
    Stock Plan, as amended, of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|10.2*       | 1996
    Non-Employee Director Stock Option Plan. (Incorporated by reference
    to the Company’s Registration Statement on Form SB-2 (Registration
    Statement No. 333-5981) declared effective on September 26, 1996)                                                                                                                                                                                                                                                                                                                                     
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|10.3*       | Form
    of Indemnification Agreement entered into by the Company and each  of
    its
Directors and officers. (Incorporated by reference to the Company’s  Registration
Statement on Form SB-2 (Registration Statement No. 333-  5981)
declared effective on September 26, 1996.)                                                                                                                                                                                                                                                                            
|            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|10.4*       | Employment
    Agreement dated October 1, 1999 between the Company and  Nicholas
    Visco. (Incorporated by reference to the Companys Annual  Report
    on Form 10-K for the year ended December 31, 1999.) See Exhibit  10.23                                                                                                                                                                                                                                                                                                                             

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|Exhibit No. | Description of Exhibit                                                                                                                                                                                                                                                                                                                                                               
|----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.5*       | Employee’s Invention
    Assignment and Confidentiality Agreement.(Incorporated by reference
    to the Company’s Registration Statement on    Form SB-2 (Registration
    Statement No. 333-5981) declared effective on    September 26, 1996.)                                                                                                                                     
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.6        | Services Provider
        Agreement by and between Oracle Corporation and the Company dated July
        26, 1994. (Incorporated by reference to the Company’s Registration Statement
        on Form SB-2 (Registration Statement No. 333- 5981) declared effective
    on September 26, 1996.) See Exhibit 10.8.                                                                   
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.7        | Agreement by
        and between the Company and Intelligroup Asia Private Limited ("Intelligroup
        Asia") relating to operational control of Intelligroup Asia, with related
        agreements. (Incorporated by reference to the Company’s Registration
        Statement on Form SB-2 (Registration Statement No. 333- 5981) declared
    effective on September 26, 1996.)
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.8        | Amendment No.
        1 to Services Provider Agreement by and between Oracle Corporation and
        the Company dated December 30, 1996. (Incorporated by reference to the
        Company’s Annual Report on Form 10-KSB for the year ended December 31,
    1996.) See Exhibit 10.6.                                                                                              
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.9        | R/3 National
        Logo Partner Agreement by and between SAP America, Inc. and the Company
        dated as of April 29, 1997. (Incorporated by reference to the Company’s
        Registration Statement on Form SB-2 (Registration Statement No. 333-29119)
    declared effective on June 26, 1997.) See Exhibits 10.10, 10.14 and 10.24.                                       
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.10       | ASAP Partner
        Addendum to R/3 National Logo Partner Agreement between SAP America,
        Inc. and the Company effective July 1, 1997 (amends existing R/3 National
        Logo Partner Agreement). (Incorporated by reference to the Company’s
        Quarterly Report on Form 10-QSB for the quarter ended September 30, 1997.)
    See Exhibits 10.9, 10.14 and 10.24.  
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.11       | Implementation
        Partner Agreement between PeopleSoft, Inc. and the Company effective
        July 15, 1997. (Incorporated by reference to the Company’s Quarterly
        Report on Form 10-QSB for the quarter ended September 30, 1997.) See
    Exhibit 10.13.                                                                                                             
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.12       | Lease Agreement
        between Alfieri-Parkway Associates, as Landlord, and Intelligroup, Inc.,
        as Tenant, dated March 17, 1998. (Incorporated by reference to the Company’s
        Quarterly Report on Form
10-Q for the quarter ended March 31, 1998.)                                                                                                                   
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.13       | Fifth Amendment
        to the Implementation Partner Agreement dated July 15, 1998, between
    the Company and PeopleSoft, Inc. See Exhibit 10.11.                                                                                                                                                                                                                                 
|            |                                                                                                                                                                                                                                                                                                                                                                                      
|10.14       | Amendment to
        the National Implementation Partner Agreement dated as of January 1,
        1999, between SAP America and the Company. See Exhibits 10.9, 10.10 and
    10.24.                                                                                                                                                                                                 

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|Exhibit No. | Description of Exhibit                                                                                                                                                                                                                                                                                                
|----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|            |                                                                                                                                                                                                                                                                                                                       
|10.15       | Contribution
    Agreement by and between Intelligroup, Inc. and SeraNova,    Inc. dated as of January
    1, 2000. (Incorporated by reference to the    Company’s Annual Report
    on Form 10-K for the year ended December 31, 1999.)                                                                              
|            |                                                                                                                                                                                                                                                                                                                       
|10.16       | Distribution
    Agreement by and between Intelligroup, Inc. and SeraNova,    Inc. dated as of January
    1, 2000. (Incorporated by reference to the    Company’s Annual Report
    on Form 10-K for the year ended December 31, 1999.)                                                                              
|            |                                                                                                                                                                                                                                                                                                                       
|10.17       | Services Agreement
    by and between Intelligroup, Inc. and SeraNova, Inc.    dated as of January
    1, 2000. (Incorporated by reference to the Company’s    Annual Report on Form
    10-K for the year ended December 31, 1999.)                                                                                  
|            |                                                                                                                                                                                                                                                                                                                       
|10.18       | Space Sharing
    Agreement by and among Intelligroup, Inc. and SeraNova,    Inc. dated as of January
    1, 2000. (Incorporated by reference to the    Company’s Annual Report
    on Form 10-K for the year ended December 31, 1999.)                                                                               
|            |                                                                                                                                                                                                                                                                                                                       
|10.19       | Tax
          Sharing Agreement by and between Intelligroup, Inc. and SeraNova, Inc.
    dated as of January 1, 2000. (Incorporated by reference to the  Company’s
    Annual Report on Form 10-K for the year ended December 31, 1999.)                                                                              
|            |                                                                                                                                                                                                                                                                                                                       
|10.20       | Amended and Restated
    Revolving Credit Loan and Security Agreement    among the Company,
    Empower, Inc. and PNC Bank, National Association.    (Incorporated by reference
    to the Company’s Quarterly Report on Form 10-Q
    for the quarter ended June 30, 2000.)                                          
|            |                                                                                                                                                                                                                                                                                                                       
|10.21       | Amended and Restated
    Promissory Note by and between the Company and    SeraNova, Inc. dated
    as of May 31, 2000. (Incorporated by reference to the    Company’s Report on
    Form 8-K/A filed September 14, 2000.) See Exhibit 10.22.                                                                         
|            |                                                                                                                                                                                                                                                                                                                       
|10.22       | Agreement and
    Waiver with respect to Amended and Restated Promissory    Note
    by and between the Company and SeraNova, Inc. dated as of September
    29, 2000. (Incorporated by reference to the Company’s
    Quarterly Report on
    Form 10-Q for the quarter ended September 30, 2000.) See Exhibit 10.21.
|            |                                                                                                                                                                                                                                                                                                                       
|10.23*      | First Amendment
    to Employment Agreement between the Company and    Nicholas Visco dated
    November 1, 2000. (Incorporated by reference to the    Companys
    Annual Report on Form 10-K for the year ended December 31, 2000.)
    See Exhibit 10.4.                                                          

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|Exhibit
    No. | Description
    of Exhibit                                                                                                                                                                                                                                                                                                                                     
|--------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.24           | mySap.com
    Partner-Services Addendum effective June 7, 2000 to R/3National
    Logo Partner Agreement between SAP America, Inc. and theCompany.
    (Incorporated by reference to the Companys Annual Report onForm
    10-K for the year ended December 31, 2000.) See Exhibits 10.9, 10.10
    and 10.14.                                                
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.25           | Service
    Alliance Master Agreement and Addendums dated May 5, 2000 between
    PeopleSoft, Inc. and the Company. (Incorporated by reference tothe
    Companys Annual Report on Form 10-K for the year ended December 31,
    2000.)                                                                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.26           | First
    Amendment to Loan Documents and Waiver Agreement dated March
    27, 2002 between the Company, Empower, Inc. and PNC Bank, National
    Association. (Incorporated by reference to the Company's Annual Report
    on Form 10-K for the year ended December 31, 2001.)                                                                               
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.27*          | Amended
    and Restated Employment Agreement dated September 20, 2002 between
    the Company and Nagarjun Valluripalli.(Incorporated
    by reference
    to the Companys Quarterly Report on Form 10-Q for the quarter ended
    September 30, 2002.)                                                                                                      
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.28           | Second
          Amendment to Loan Documents and Waiver Agreement dated January 6, 2003
          between the Company, Empower, Inc. and PNC Bank, National Association.
          (Incorporated by reference to the Company's Annual Report on Form 10-K
    for the year ended December 31, 2002.)                                                           
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.29           | Third
          Amendment to Loan Documents and Waiver Agreement dated July 31, 2003
          between the Company, Empower, Inc. and PNC Bank, National Association.
          (Incorporated by reference to the Companys Current Report on
          Form 8-K dated July 31, 2003, filed with the Securities and Exchange
    Commission on August 5, 2003.)
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.30           | Agreement
          dated August 7, 2003, by and between Intelligroup, Inc. and Ashok Pandey.
          (Incorporated by reference to the Companys Current Report on
          Form 8-K dated August 7, 2003, filed with the Securities and Exchange
    Commission on August 12, 2003.)                                                                      
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.31*          | Employment
    Agreement dated March 25, 2004 between the Company and Christian
    Misvaer. (Incorporated by reference to the Companys Annual Report
    filed on Form 10-K for the year ended December 31, 2003.                                                                                                                                            
|                |                                                                                                                                                                                                                                                                                                                                                                
|10.32           | Fourth
          Amendment to Loan Documents and Waiver Agreement dated October 22,
          2003 between the Company, Empower, Inc. and PNC Bank, National Association.
          (Incorporated by reference to the Companys Quarterly Report on
    Form 10-Q for the quarter ended September 30, 2003.)                                                   

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|Exhibit
    No. | Description
    of Exhibit                                                                                                                                                                                                                                                                                                                                  
|--------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.33*          | Separation
          Agreement between
Nicholas Visco and Intelligroup, Inc. dated November
24, 2003. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated
November 24, 2003, filed with the Securities and Exchange
Commission on
November 24, 2003.)                                                                              
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.34           | Waiver
        Agreement dated March 22, 2004 between the Company, Empower, Inc. and
        PNC Bank, National Association. (Incorporated by reference to the Companys
        Annual Report on Form 10-K for the
year ended December 31, 2003.)                                                                                                          
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.35*          | Employment
          Agreement effective
as of April 5, 2004 between the Company and
David J. Distel. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated
March 31, 2004, filed with the Securities and Exchange
Commission on April 5, 2004.)                                                                                     
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.36*          | Separation
          Agreement between
the Company and Ed Carr. (Incorporated by
reference to the Companys
Current Report on Form 8-K dated March 31,
2004, filed with the
Securities and Exchange Commission on April 5, 2004.)                                                                                                                           
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.37*          | 2004
    Equity Incentive Award Plan.                                                                                                                                                                                                                                                                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.38*          | Employment
          Agreement dated
July 26, 2004 between the Company and Douglas
Berto. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated
August 23, 2004, filed with the Securities and Exchange
Commission on
August 23, 2004.)                                                                                              
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.39*          | First
    Amendment to the 2004 Equity Incentive Award Plan. (Incorporatedby
    reference to the Companys
Current Report on Form 8-K datedSeptember
29, 2004, filed
with the Securities and Exchange Commission on October
5, 2004.)                                                                                                                      
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.40           | Common
        Stock Purchase Agreement dated September 29, 2004 by and between the
        Company, SB Asia Infrastructure Fund LP and Venture Tech Assets Ltd.
        (Incorporated by reference to the Companys Current Report on Form
        8-K dated September 29, 2004, filed with the Securities and Exchange
    Commission on October 5, 2004.)
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.41           | Fifth
        Amendment to Loan Documents and Waiver Agreement dated September 29,
        2004 between the Company, Empower, Inc. and PNC Bank, National Association.
        (Incorporated by reference to the
Companys Current Report on Form 8-K dated September 29, 2004, filed with
the Securities and Exchange Commission on October 5, 2004.)      
|                |                                                                                                                                                                                                                                                                                                                                                             
|10.42*          | Separation
          Agreement between
the Company and David J. Distel dated October
15, 2004. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated
October 15, 2004, filed with the Securities and Exchange
Commission on
October 15, 2004.)                                                                                       

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|Exhibit
    No. | Description
    of Exhibit                                                                                                                                                                                                                                                                                                                            
|--------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.43*          | Separation
          Agreement between
the Company and Douglas Berto dated December
6, 2004. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated
December 6, 2004, filed with the Securities and Exchange
Commission on
December 10, 2004.)                                                                                  
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.44           | Amendment
        No. 1 to the Common Stock Purchase Agreement dated September 29, 2004.
        (Incorporated by reference to the Companys Current Report on Form
        8-K dated March 25, 2005, filed with the Securities and Exchange Commission
    on March 25, 2005.)                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.45*          | Employment
    Agreement effective June 1, 2005 between the Company and Madhu
    Poomalil. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated June 2, 2005, filed with the Securities and Exchange
Commission on June 7, 2005.)                                                                                            
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.46*          | Second
          Amended and Restated
Employment Agreement effective June 21, 2005
between the Company and Shirley Spoors. (Incorporated by reference to
the Companys
Current Report on Form 8-K dated June 21, 2005, filed with
the Securities and
Exchange Commission on June 27, 2005.)                                                           
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.47*          | Employment
          Agreement effective
July 1, 2005 between the Company and Ranjit
Prithviraj. (Incorporated
by reference to the Companys Current Report
on Form 8-K dated
June 29, 2005, filed with the Securities and Exchange
Commission on
July 5, 2005.)                                                                                      
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.48*          | Separation
    Agreement dated June 29, 2005 between the Company andChristian
    Misvaer. (Incorporated
by reference to the Companys CurrentReport
on Form 8-K dated June 29, 2005, filed with the Securities andExchange
Commission on July 5, 2005.)                                                                                              
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.49*          | Independent
    Contractor Agreement dated July 1, 2005 between the Company
    and Pontus, Inc.
(Incorporated by reference to the CompanysCurrent
Report on Form 8-K dated June 29, 2005, filed with the Securitiesand
Exchange Commission on July 5, 2005.)                                                                                        
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.50*          | Employment
    Agreement effective June 30, 2005 between the Company andVikram
    Gulati. (Incorporated
by reference to the Companys CurrentReport
on Form 8-K dated June 30, 2005, filed with the Securities andExchange
Commission on July 7, 2005.)                                                                                              
|                |                                                                                                                                                                                                                                                                                                                                                       
|10.51           | Sixth
        Amendment to Loan Documents and Waiver Agreement dated September 30,
        2005 between the Company, Empower, Inc. and PNC Bank, National Association.
        (Incorporated by reference to the
Companys Current Report on Form 8-K dated September 30, 2005, filed with
the Securities and Exchange Commission on October 6, 2005.)
|                |                                                                                                                                                                                                                                                                                                                                                       
|14              | Code
        of Business Conduct and Ethics. (Incorporated by reference to the Companys
    Annual Report on Form 10-K for the year ended December 31, 2003.)                                                                                                                                                                                        

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|Exhibit
    No. | Description
    of Exhibit                                                                                                                                                                                                                                                         
|--------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |                                                                                                                                                                                                                                                                                    
|21              | Subsidiaries
    of the Registrant.                                                                                                                                                                                                                                                
|                |                                                                                                                                                                                                                                                                                    
|16.1            | Letter
          dated August 11,
2004 to the Securities and Exchange Commission from
Deloitte & Touche
LLP. (Incorporated by reference to the Companys Current
Report on Form
8-K dated August 5, 2004, filed with the Securities and
Exchange Commission
on August 11, 2004.)   
|                |                                                                                                                                                                                                                                                                                    
|16
    .2       | Letter
          dated November
1, 2004 to the Securities and Exchange Commission from
Deloitte & Touche
LLP. (Incorporated by reference to the Companys Current
Report on Form
8-K dated October 26, 2004, filed with theSecurities
and Exchange Commission on November 1, 2004.)
|                |                                                                                                                                                                                                                                                                                    
|31.1†           | Certifications
    of Chief Executive Officer Pursuant to Rule 13a-14(a), as Adopted
    Pursuant to Section 301 of the Sarbanes-Oxley Act of 2002                                                                                                                                 
|                |                                                                                                                                                                                                                                                                                    
|31.2†           | Certifications
    of Chief Financial Officer Pursuant to Rule 13a-14(a), asAdopted
    Pursuant to Section 301 of the Sarbanes-Oxley Act of 2002                                                                                                                                  
|                |                                                                                                                                                                                                                                                                                    
|32.1†           | Certifications
    of Chief Executive Officer Pursuant to 18 U.S.C. Section1350,
    as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of2002                                                                                                                           
|                |                                                                                                                                                                                                                                                                                    
|32.2†           | Certifications
    of Chief Financial Officer Pursuant to 18 U.S.C. Section1350,
    as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of2002                                                                                                                           
|                |                                                                                                                                                                                                                                                                                    

| 
|-
|*
| 
|†

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