##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 29, 2009.
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File Number 000-27792
 
 COMSYS IT PARTNERS, INC.
  
 Delaware
(State or other jurisdiction 
of incorporation or organization)
    
    56-1930691
(I.R.S. Employer
Identification Number)
 4400 Post Oak Parkway, Suite 1800
Houston, TX 77027
(Address, including zip code, of principal executive offices)
 (713) 386-1400
(Registrants telephone number, including area code)
 
 þ o
 o o
  Large accelerated filer  o
    
    
    
    Accelerated filer þ
    
    
    
    Non-accelerated filer o
    
    

    (Do not check if a smaller reporting company)Smaller reporting company o
 o þ




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##### 



TABLE OF CONTENTS
 PageCautionary Note Regarding Forward-Looking Statements
    
    
    2PART I  FINANCIAL INFORMATIONItem 1.
    
    Financial Statements
    
    
    3Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    18Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    25Item 4.
    
    Controls and Procedures
    
    
    26PART II  OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    
    27Item 1A.
    
    Risk Factors
    
    
    27Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    27Item 3.
    
    Defaults upon Senior Securities
    
    
    27Item 4.
    
    Submission of Matters to a Vote of Securities Holders
    
    
    27Item 5.
    
    Other Information
    
    
    27Item 6.
    
    Exhibits
    
    
    27Signatures
    
    
    29EX-31.1EX-31.2EX-32




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##### Table of Contents



CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
   
    
    economic declines that affect our business, including our profitability, liquidity
or the ability to comply with applicable loan covenants;
    
    the financial stability of our lenders and their ability to honor their commitments
related to our credit agreements;
    
    whether governments will amend existing regulations or impose additional regulations
or licensing requirements in such a manner as to increase our costs of doing business
or restrict access to qualified technology workers;
    
    the risk of increased tax rates;
    
    adverse changes in credit and capital markets conditions that may affect our ability
to obtain financing or refinancing on favorable terms or that may warrant changes to
existing credit terms;
    
    the financial stability of our customers and other business partners and their
ability to pay their outstanding obligations or provide committed services;
    
    changes in levels of unemployment and other economic conditions in the United
States, or in particular regions or industries;
    
    the impact of competitive pressures on our ability to maintain or improve our
operating margins, including pricing pressures as well as any change in the demand for
our services;
    
    the risk in an uncertain economic environment of increased incidences of employment
disputes, employment litigation and workers compensation claims;
    
    our success in attracting, training, retaining and motivating billable consultants
and key officers and employees;
    
    our ability to shift a larger percentage of our business mix into IT solutions,
project management and business process outsourcing and, if successful, our ability to
manage those types of business profitably;
    
    weakness or reductions in corporate information technology spending levels;
    
    our ability to maintain existing client relationships and attract new clients in the
context of changing economic or competitive conditions;
    
    the entry of new competitors into the U.S. staffing services market due to the
limited barriers to entry or the expansion of existing competitors in that market;
    
    increases in employment-related costs such as healthcare and unemployment taxes;
    
    the possibility of our incurring liability for the activities of our billable
consultants or for events impacting our billable consultants on our clients premises;
    
    the risk that we may be subject to claims for indemnification under our customer
contracts;
    
    the risk that cost cutting or restructuring activities could cause an adverse impact
on certain of our operations; and
    
    adverse changes to managements periodic estimates of future cash flows that may
affect our assessment of our ability to fully recover our goodwill.
  2




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PART I  FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS
 COMSYS IT Partners, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
 Three Months EndedMarch 29,
    
    
    March 30,2009
    
    
    2008(In thousands, except per share amounts)Revenues from services
    
    $
    162,694
    
    
    $
    183,383Cost of services
    
    
    124,598
    
    
    
    138,727Gross profit
    
    
    38,096
    
    
    
    44,656Operating costs and expenses:Selling, general and administrative
    
    
    33,183
    
    
    
    34,764Restructuring costs
    
    
    3,620
    
    
    
    Depreciation and amortization
    
    
    2,074
    
    
    
    1,82038,877
    
    
    
    36,584Operating income (loss)
    
    
    (781
    )
    
    
    8,072Interest expense, net
    
    
    952
    
    
    
    1,603Other income, net
    
    
    (105
    )
    
    
    (53
    )Income (loss) before income taxes
    
    
    (1,628
    )
    
    
    6,522Income tax expense
    
    
    243
    
    
    
    1,418Net income (loss)
    
    $
    (1,871
    )
    
    $
    5,104Basic net income (loss) per common share
    
    $
    (0.09
    )
    
    $
    0.25Diluted net income (loss) per common share
    
    $
    (0.09
    )
    
    $
    0.25Weighted average basic and diluted shares outstanding:Basic
    
    
    19,774
    
    
    
    19,579Diluted
    
    
    19,774
    
    
    
    20,617
 See notes to consolidated financial statements
 3




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COMSYS IT Partners, Inc. and Subsidiaries
Consolidated Statements of Comprehensive Income
(Unaudited)
 Three Months EndedMarch 29,
    
    
    March 30,2009
    
    
    2008(In thousands)Net income (loss)
    
    $
    (1,871
    )
    
    $
    5,104Foreign currency translation adjustments
    
    
    5
    
    
    
    21Total comprehensive income (loss)
    
    $
    (1,866
    )
    
    $
    5,125
 See notes to consolidated financial statements
 4




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COMSYS IT Partners, Inc. and Subsidiaries
Consolidated Balance Sheets
 March 29,
    
    
    December 28,2009
    
    
    2008(Unaudited)
    
    
    (Note 1)(In thousands, except share and par value amounts)AssetsCurrent assets:Cash and cash equivalents
    
    $
    1,215
    
    
    $
    22,695Accounts receivable, net of allowance of $3,596 and $3,232, respectively
    
    
    193,405
    
    
    
    202,297Prepaid expenses and other
    
    
    3,660
    
    
    
    3,116Restricted cash
    
    
    2,487
    
    
    
    2,489Total current assets
    
    
    200,767
    
    
    
    230,597Fixed assets, net
    
    
    15,846
    
    
    
    16,596Goodwill
    
    
    88,709
    
    
    
    89,064Other intangible assets, net
    
    
    11,058
    
    
    
    11,962Deferred financing costs, net
    
    
    3,240
    
    
    
    1,175Restricted cash
    
    
    308
    
    
    
    308Other assets
    
    
    1,264
    
    
    
    1,478Total assets
    
    $
    321,192
    
    
    $
    351,180Liabilities and stockholders equityCurrent liabilities:Accounts payable
    
    $
    138,466
    
    
    $
    156,528Payroll and related taxes
    
    
    23,812
    
    
    
    25,975Interest payable
    
    
    295
    
    
    
    337Other current liabilities
    
    
    9,167
    
    
    
    9,728Total current liabilities
    
    
    171,740
    
    
    
    192,568Long-term debt
    
    
    60,013
    
    
    
    69,692Other liabilities
    
    
    6,965
    
    
    
    5,435Total liabilities
    
    
    238,718
    
    
    
    267,695Commitments and contingenciesStockholders equity:Preferred stock, no par value; 5,000,000 shares authorized; none issued
    
    
    
    
    
    
    Common
stock, par value $.01; 95,000,000 shares authorized and 20,811,293 shares outstanding in 2009; 95,000,000 shares authorized and 20,465,028 shares outstanding in 2008
    
    
    207
    
    
    
    203Common stock warrants
    
    
    1,734
    
    
    
    1,734Accumulated other comprehensive loss
    
    
    (85
    )
    
    
    (90
    )Additional paid-in capital
    
    
    228,211
    
    
    
    227,360Accumulated deficit
    
    
    (147,593
    )
    
    
    (145,722
    )Total stockholders equity
    
    
    82,474
    
    
    
    83,485Total liabilities and stockholders equity
    
    $
    321,192
    
    
    $
    351,180
 See notes to consolidated financial statements
 5




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COMSYS IT Partners, Inc. and Subsidiaries
Consolidated Statements of Shareholders Equity
(Unaudited)
 AccumulatedCommon
    
    
    Other
    
    
    Additional
    
    
    
    
    
    
    TotalCommon
    
    
    Stock
    
    
    Comprehensive
    
    
    Paid-in
    
    
    Accumulated
    
    
    Stockholders'Stock
    
    
    Warrants
    
    
    Income (Loss)
    
    
    Capital
    
    
    Deficit
    
    
    Equity(In thousands, except share data)Balance as of December 30, 2007
    
    $
    201
    
    
    $
    1,734
    
    
    $
    57
    
    
    $
    223,174
    
    
    $
    (80,534
    )
    
    $
    144,632Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (65,188
    )
    
    
    (65,188
    )Foreign currency translations
    
    
    
    
    
    
    
    
    
    
    (147
    )
    
    
    
    
    
    
    
    
    
    
    (147
    )Issuance of 342,878 shares of restricted common stock
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    (2
    )
    
    
    
    
    
    
    Forfeiture of 25,132 vested shares of restricted common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (332
    )
    
    
    
    
    
    
    (332
    )Options exercised for 8,200 shares of common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    83
    
    
    
    
    
    
    
    83Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,437
    
    
    
    
    
    
    
    4,437Balance as of December 28, 2008
    
    
    203
    
    
    
    1,734
    
    
    
    (90
    )
    
    
    227,360
    
    
    
    (145,722
    )
    
    
    83,485Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,871
    )
    
    
    (1,871
    )Foreign currency translations
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    
    
    
    
    5Issuance of 351,500 shares of restricted common stock
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    Forfeiture of 4,902 shares of restricted common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12
    )
    
    
    
    
    
    
    (12
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    867
    
    
    
    
    
    
    
    867Balance as of March 29, 2009
    
    $
    207
    
    
    $
    1,734
    
    
    $
    (85
    )
    
    $
    228,211
    
    
    $
    (147,593
    )
    
    $
    82,474
 See notes to consolidated financial statements
 6




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COMSYS IT Partners, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
 Three Months EndedMarch 29,
    
    
    March 30,2009
    
    
    2008(In thousands)Cash flows from operating activitiesNet income (loss)
    
    $
    (1,871
    )
    
    $
    5,104Adjustments to reconcile net income (loss) to net cash provided by operating activities:Depreciation and amortization
    
    
    2,074
    
    
    
    1,820Restructuring costs
    
    
    3,223
    
    
    
    Provision for doubtful accounts
    
    
    443
    
    
    
    18Stock-based compensation
    
    
    867
    
    
    
    1,100Amortization of deferred financing costs
    
    
    228
    
    
    
    217Other noncash expense, net
    
    
    243
    
    
    
    1,418Loss on asset disposal
    
    
    2
    
    
    
    Changes in operating assets and liabilities, net of effects of acquisitions:Accounts receivable
    
    
    8,420
    
    
    
    2,765Prepaid expenses and other
    
    
    (525
    )
    
    
    (1,183
    )Accounts payable
    
    
    (16,065
    )
    
    
    607Payroll and related taxes
    
    
    (2,175
    )
    
    
    (3,071
    )Other
    
    
    (1,612
    )
    
    
    164Net cash provided by (used in) operating activities
    
    
    (6,748
    )
    
    
    8,959Cash flows from investing activitiesCapital expenditures
    
    
    (439
    )
    
    
    (1,064
    )Acquisitions, net of cash acquired
    
    
    (2,300
    )
    
    
    (1,387
    )Net cash used in investing activities
    
    
    (2,739
    )
    
    
    (2,451
    )Cash flows from financing activitiesRepayments under revolving credit facility, net
    
    
    (9,679
    )
    
    
    (5,277
    )Cash paid for financing costs
    
    
    (2,293
    )
    
    
    Repayments of long-term debt
    
    
    
    
    
    
    (1,250
    )Proceeds from issuance of common stock, net of issuance costs
    
    
    
    
    
    
    13Net cash used in financing activities
    
    
    (11,972
    )
    
    
    (6,514
    )Effect of exchange rates on cash
    
    
    (21
    )
    
    
    (3
    )Net decrease in cash
    
    
    (21,480
    )
    
    
    (9
    )Cash, beginning of period
    
    
    22,695
    
    
    
    1,594Cash, end of period
    
    $
    1,215
    
    
    $
    1,585
 See notes to consolidated financial statements
 7




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COMSYS IT Partners, Inc. and Subsidiaries
 Notes to Consolidated Financial Statements
 1. General
    Disclosures About
Segments of an Enterprise and Related Information
 2. Business Combinations
   8




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9




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3. Fair Value of Financial Instruments
 Fair Value Measurements
 4. Restructuring Costs
   Employeeseverance
    
    
    Lease costs
    
    
    TotalBalance as of December 30, 2007
    
    $
    
    
    
    $
    355
    
    
    $
    355Adjustments
    
    
    
    
    
    
    
    
    
    
    Charges
    
    
    453
    
    
    
    64
    
    
    
    517Cash payments
    
    
    (41
    )
    
    
    (177
    )
    
    
    (218
    )Balance as of December 28, 2008
    
    
    412
    
    
    
    242
    
    
    
    654Adjustments
    
    
    
    
    
    
    
    
    
    
    Charges
    
    
    215
    
    
    
    3,195
    
    
    
    3,410Cash payments
    
    
    (248
    )
    
    
    (75
    )
    
    
    (323
    )Balance as of March 29, 2009
    
    $
    379
    
    
    $
    3,362
    
    
    $
    3,741
  5. Long-Term Debt
    10




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
    
    a $5.0 million minimum availability reserve,
    
    a $1.5 million reserve for outstanding letters of credit, and
 
    
    a $1.0 million reserve for the ASET acquisition earnout.
   
    
    incur additional indebtedness;
    
    paying more than $10 million for stock repurchases and dividends;
    
    incur liens;
    
    make capital expenditures;
    
    make certain investments or acquisitions;
    
    repay debt; and
    
    dispose of property.
   6. Income Taxes
   11




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Accounting for Income
Taxes
 Business Combinations
   7. Net Income (Loss) Per Share
    12




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Three Months EndedMarch 29,
    
    
    March 30,2009
    
    
    2008Net income (loss) attributable to common stockholders  basic
    
    $
    (1,779
    )
    
    $
    4,905Net income (loss) attributable to unvested restricted stock holders
    
    
    (69
    )
    
    
    138Net income (loss) attributable to warrant holders
    
    
    (23
    )
    
    
    61Total net income (loss)
    
    $
    (1,871
    )
    
    $
    5,104Weighted average common shares outstanding  basic
    
    
    19,774
    
    
    
    19,579Add: dilutive restricted stock, stock options and warrants
    
    
    
    
    
    
    1,038Diluted weighted average common shares outstanding
    
    
    19,774
    
    
    
    20,617Basic net income (loss) per common share
    
    $
    (0.09
    )
    
    $
    0.25Diluted net income (loss) per common share
    
    $
    (0.09
    )
    
    $
    0.25
  8. Commitments and Contingencies
      13




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9. Stock Compensation Plans
  Plan Descriptions
     14




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Stock Options
  Weighted-Average1995
    
    
    2003
    
    
    2004
    
    
    
    
    
    
    Exercise PricePlan
    
    
    Equity Plan
    
    
    Equity Plan
    
    
    Total
    
    
    Per ShareOutstanding at December 30, 2007
    
    
    1,250
    
    
    
    445,000
    
    
    
    330,266
    
    
    
    776,516
    
    
    $
    9.75Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    (8,200
    )
    
    
    (8,200
    )
    
    $
    8.55Forfeited
    
    
    (527
    )
    
    
    (1,387
    )
    
    
    (18,336
    )
    
    
    (20,250
    )
    
    $
    17.94Outstanding at December 28, 2008
    
    
    723
    
    
    
    443,613
    
    
    
    303,730
    
    
    
    748,066
    
    
    $
    9.54Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    (1,387
    )
    
    
    (3,333
    )
    
    
    (4,720
    )
    
    $
    10.32Outstanding at March 29, 2009
    
    
    723
    
    
    
    442,226
    
    
    
    300,397
    
    
    
    743,346
    
    
    $
    9.54Exercisable at March 29, 2009
    
    
    723
    
    
    
    425,529
    
    
    
    300,397
    
    
    
    726,649
    
    
    $
    9.56Available for issuance at March 29, 2009
    
    
    
    
    
    
    55,809
    
    
    
    181,801
    
    
    
    237,610
  Options Outstanding
    
    Options ExercisableWeightedAverage
    
    Weighted
    
    
    
    
    
    WeightedContractual
    
    Average
    
    
    
    
    
    AverageOptions
    
    Years
    
    Exercise Price
    
    Options
    
    Exercise PriceRange of Exercise Prices
    
    Outstanding
    
    Remaining
    
    per Share
    
    Exercisable
    
    per Share$7.80
    
    
    219,000
    
    
    
    4.04
    
    
    $
    7.80
    
    
    
    219,000
    
    
    $
    7.80$8.55 to $8.88
    
    
    223,961
    
    
    
    5.34
    
    
    $
    8.56
    
    
    
    207,264
    
    
    $
    8.57$11.05 to $11.98
    
    
    299,662
    
    
    
    5.68
    
    
    $
    11.32
    
    
    
    299,662
    
    
    $
    11.32$63.25 to $132.75
    
    
    723
    
    
    
    0.86
    
    
    $
    100.64
    
    
    
    723
    
    
    $
    100.64$7.80 to $132.75
    
    
    743,346
    
    
    
    5.09
    
    
    $
    9.54
    
    
    
    726,649
    
    
    $
    9.56
   Restricted Stock Awards
  15




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Weighted AverageGrant DateShares
    
    
    Fair ValueNonvested balance at December 30, 2007
    
    
    490,635
    
    
    $
    18.34Granted
    
    
    342,878
    
    
    $
    11.09Vested
    
    
    (147,227
    )
    
    $
    17.35Forfeited
    
    
    (79,443
    )
    
    $
    17.30Nonvested balance at December 28, 2008
    
    
    606,843
    
    
    $
    14.62Granted
    
    
    351,500
    
    
    $
    2.42Vested
    
    
    (178,662
    )
    
    $
    15.37Forfeited
    
    
    (333
    )
    
    $
    20.21Nonvested balance at March 29, 2009
    
    
    779,348
    
    
    $
    8.94
 10-K
   10. Related Party Transactions
    16




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11. Recent Accounting Pronouncements
 Accounting for Leases Determining the Fair Value of a Financial Asset When the Market for That Asset is Not Active
 Business Combinations
 Determination of the Useful Life of Intangible Assets Goodwill and Other Intangible Assets.
 Determining Whether
Instruments Granted in Share-Based Payment Transactions Are Participating Securities
 12. Subsequent Event
  17




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##### Table of Contents



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 The following discussion and analysis should be read in conjunction with the unaudited consolidated
financial statements and related notes appearing elsewhere in this report, as well as other reports
we file with the Securities and Exchange Commission. This discussion contains forward-looking
statements reflecting our current expectations and estimates and assumptions concerning events and
financial trends that may affect our future operating results or financial position. Actual
results and the timing of events may differ materially from those contained in these
forward-looking statements due to a number of factors, including those discussed in the section
entitled Cautionary Note Regarding Forward-Looking Statements included elsewhere in this report
and in the sections entitled Risk Factors included in this report and our Annual Report on Form
10-K for the fiscal year ended December 28, 2008.
 Our Business
  
    
    COMSYS Services, LLC (COMSYS Services), an IT staffing services provider,
    
    COMSYS Information Technology Services, Inc. (COMSYS IT), an IT staffing
services provider,
    
    Pure Solutions, Inc. (Pure Solutions), an information technology services
company,
    
    Econometrix, LLC (Econometrix), a vendor management systems software
provider,
    
    Plum Rhino Consulting LLC (Plum Rhino), a specialty staffing services
provider to the financial services industry,
    
    Praeos Technologies, Inc. (Praeos), a business intelligence and business
analytics consulting services provider,
    
    TAPFIN, LLC (TAPFIN), a provider of vendor management services, recruitment
process outsourcing services and human resources consulting, and
    
    ASET International Services, Inc. (ASET), a globalization, localization and
interactive language services provider.
   
    
    rate of technological change;
    
    rate of growth in corporate IT and professional services budgets;
    
    penetration of IT and professional services staffing in the general workforce;
    
    outsourcing of the IT and professional services workforce; and
 
    
    consolidation of supplier bases.
   18




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##### Table of Contents



st
 Overview of First Quarter 2009
    2009 Priorities
  19




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##### Table of Contents



Results of Operations
 Three Months Ended March 29, 2009, Compared to Three Months Ended March 30, 2008
  Three Months Ended
    
    Percent of Revenues
    
    Percent ChangeMarch 29,
    
    March 30,
    
    March 29,
    
    March 30,
    
    2009 $ vs.2009
    
    2008
    
    2009
    
    2008
    
    2008 $Revenues from services
    
    $
    162,694
    
    
    $
    183,383
    
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    -11.3
    %Cost of services
    
    
    124,598
    
    
    
    138,727
    
    
    
    76.6
    %
    
    
    75.6
    %
    
    
    -10.2
    %Gross profit
    
    
    38,096
    
    
    
    44,656
    
    
    
    23.4
    %
    
    
    24.4
    %
    
    
    -14.7
    %Operating costs and expenses:Selling, general and administrative
    
    
    33,183
    
    
    
    34,764
    
    
    
    20.4
    %
    
    
    19.0
    %
    
    
    -4.5
    %Restructuring costs
    
    
    3,620
    
    
    
    
    
    
    
    2.2
    %
    
    
    0.0
    %
    
    NADepreciation and amortization
    
    
    2,074
    
    
    
    1,820
    
    
    
    1.3
    %
    
    
    1.0
    %
    
    
    14.0
    %38,877
    
    
    
    36,584
    
    
    
    23.9
    %
    
    
    20.0
    %
    
    
    6.3
    %Operating income (loss)
    
    
    (781
    )
    
    
    8,072
    
    
    
    -0.5
    %
    
    
    4.4
    %
    
    
    -109.7
    %Interest expense, net
    
    
    952
    
    
    
    1,603
    
    
    
    0.6
    %
    
    
    0.8
    %
    
    
    -40.6
    %Other income, net
    
    
    (105
    )
    
    
    (53
    )
    
    
    -0.1
    %
    
    
    0.0
    %
    
    
    98.1
    %Income (loss) before income taxes
    
    
    (1,628
    )
    
    
    6,522
    
    
    
    -1.0
    %
    
    
    3.6
    %
    
    
    -125.0
    %Income tax expense
    
    
    243
    
    
    
    1,418
    
    
    
    0.2
    %
    
    
    0.8
    %
    
    
    -82.9
    %Net income (loss)
    
    $
    (1,871
    )
    
    $
    5,104
    
    
    
    -1.2
    %
    
    
    2.8
    %
    
    
    -136.7
    %Billable hours during the period
    
    
    2,092,521
    
    
    
    2,321,669
  Revenues.
 Cost of Services .
 20




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##### Table of Contents



Selling, General and Administrative Expenses .
 Restructuring Costs .
 Depreciation and Amortization .
 Interest Expense, Net.
 Provision for Income Taxes . Accounting for Income
Taxes Business
Combinations
  Liquidity and Capital Resources
 Overview
 Credit Facilities and Related Covenants
 Cash Flows
 21




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##### Table of Contents



Credit Facilities and Related Covenants
   Working Capital
    Credit Agreement
   22




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##### Table of Contents




    
    a $5.0 million minimum availability reserve,
    
    a $1.5 million reserve for outstanding letters of credit, and
 
    
    a $1.0 million reserve for the ASET acquisition.
  Debt Compliance
  
    
    incur additional indebtedness;
    
    paying more than $10 million for stock repurchases and dividends;
    
    incur liens;
    
    make capital expenditures;
 
    
    make certain investments or acquisitions;
    
    repay debt; and
 
    
    dispose of property.
   Cash Flows
  Three Months EndedMarch 29,
    
    March 30,2009
    
    2008Net cash provided by (used in) operating activities
    
    $
    (6,748
    )
    
    $
    8,959Net cash used in investing activities
    
    
    (2,739
    )
    
    
    (2,451
    )Net cash used in financing activities
    
    
    (11,972
    )
    
    
    (6,514
    )Effect of exchange rates on cash
    
    
    (21
    )
    
    
    (3
    )Net decrease in cash
    
    $
    (21,480
    )
    
    $
    (9
    )
  23




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##### Table of Contents



Seasonality
  Off-Balance Sheet Arrangements
  Related Party Transactions
  24




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##### Table of Contents



Contingencies and Indemnifications
  Critical Accounting Policies and Estimates
  Recent Accounting Pronouncements
  
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
   Interest Rate Risks
  Foreign Currency Risks
  25




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##### Table of Contents



Equity Market Risks
   
 ITEM 4. CONTROLS AND PROCEDURES
 Disclosure Controls and Procedures
   Changes in Internal Controls over Financial Reporting
  26




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##### Table of Contents



PART II  OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A. RISK FACTORS
  
 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  Total Number of
    
    Average PricePeriod
    
    Shares Purchased
    
    Paid per ShareDecember 29, 2008  January 25, 2009
    
    
    4,902
    
    
    $
    2.44January 26, 2009  February 22, 2009
    
    
    
    
    
    $
    February 23, 2009  March 29, 2009
    
    
    
    
    
    $
    4,902
    
    
    $
    2.44
   
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS
  27




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##### Table of Contents



Incorporated by ReferenceExhibit
    
    
    
    
    
    ExhibitNumber
    
    Exhibit Description
    
    Form
    
    Number
    
    Filing Date3.1
    
    
    Amended and Restated Certificate of Incorporation of COMSYS IT Partners, Inc.
    
    8-K
    
    
    3.1
    
    
    October 4, 20043.2
    
    
    Amended and Restated Bylaws of COMSYS IT Partners, Inc.
    
    8-K
    
    
    3.2
    
    
    October 4, 20043.3
    
    
    First Amendment to the Amended and Restated Bylaws of COMSYS IT Partners, Inc.
    
    8-K
    
    
    3.1
    
    
    May 4, 20054.1
    
    
    Registration Rights Agreement, dated as of September 30, 2004, between COMSYS
IT Partners, Inc. and certain of the old COMSYS Holdings stockholders party
thereto
    
    8-A/A
    
    
    4.2
    
    
    November 2, 20044.2
    
    
    Amendment No. 1 to Registration Rights Agreement dated April 1, 2005 between
COMSYS IT Partners, Inc., and certain of the old COMSYS Holdings stockholders
party thereto
    
    10-Q
    
    
    4.2
    
    
    May 6, 20054.3
    
    
    Amended and Restated Registration Rights Agreement, dated as of September 30,
2004, between COMSYS IT Partners, Inc. and certain of the old Venturi
stockholders party thereto
    
    8-A/A
    
    
    4.3
    
    
    November 2, 20044.4
    
    
    Amendment No. 1 to Amended and Restated Registration Rights Agreement dated
April 1, 2005 between COMSYS IT Partners, Inc., and certain of the old
Venturi stockholders party thereto
    
    10-Q
    
    
    4.4
    
    
    May 6, 20054.7#
    
    
    Common Stock Purchase Warrant dated as of April 14, 2003, issued by the
Company in favor of BNP Paribas
    
    8-K
    
    
    99.16
    
    
    April 25, 20034.8
    
    
    Specimen Certificate for Shares of Common Stock
    
    10-K
    
    
    4.6
    
    
    April 1, 200510.1
    
    
    Consent and Ninth Amendment to Credit Agreement, dated as of March 23, 2009,
among COMSYS Services LLC, COMSYS Information Technology Services, Inc., Pure
Solutions, Inc., Plum Rhino Consulting, LLC, Praeos Technologies, LLC, ASET
International Services Corporation, and TAPFIN LLC, as borrowers, COMSYS IT
Partners, Inc., PFI LLC, COMSYS IT Canada, Inc., Econometrix, LLC, as
guarantors, COMSYS Services LLC, acting in its capacity as borrowing agent
and funds administrator for the borrowers, GE Business Financial Services,
Inc., as administrative agent, a lender, sole bookrunner and sole lead
arranger, ING Capital LLC, Allied Irish Banks PLC and BMO Capital Markets
Financing, Inc., as co-documentation agents and as lenders, GMAC Commercial
Finance LLC, as syndication agent and as a lender, and the lenders from time
to time party thereto
    
    8-K
    
    
    10.1
    
    
    March 24, 200931.1*
    
    
    Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 200231.2*
    
    
    Certification of Chief Accounting Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 200232*
    
    
    Certification of Chief Executive Officer and Chief Accounting Officer
pursuant to 18 U.S.C. Section 1350, as adopted, pursuant to Section
906 of the Sarbanes-Oxley Act of
2002
 28




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##### Table of Contents



SIGNATURES
  COMSYS IT PARTNERS, INC.Date:  May 7, 2009
    By:
    /s/ Larry L. EnterlineName:
    Larry L. EnterlineTitle:
    Chief Executive OfficerDate:  May 7, 2009
    By:
    /s/ Amy BobbittName:
    Amy BobbittTitle:
    Senior Vice President and Chief Accounting Officer 29




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##### Table of Contents



EXHIBIT INDEX
 Incorporated by ReferenceExhibit
    
    
    
    
    
    ExhibitNumber
    
    Exhibit Description
    
    Form
    
    Number
    
    Filing Date3.1
    
    
    Amended and Restated Certificate of Incorporation of COMSYS IT Partners, Inc.
    
    8-K
    
    
    3.1
    
    
    October 4, 20043.2
    
    
    Amended and Restated Bylaws of COMSYS IT Partners, Inc.
    
    8-K
    
    
    3.2
    
    
    October 4, 20043.3
    
    
    First Amendment to the Amended and Restated Bylaws of COMSYS IT Partners, Inc.
    
    8-K
    
    
    3.1
    
    
    May 4, 20054.1
    
    
    Registration Rights Agreement, dated as of September 30, 2004, between COMSYS
IT Partners, Inc. and certain of the old COMSYS Holdings stockholders party
thereto
    
    8-A/A
    
    
    4.2
    
    
    November 2, 20044.2
    
    
    Amendment No. 1 to Registration Rights Agreement dated April 1, 2005 between
COMSYS IT Partners, Inc., and certain of the old COMSYS Holdings stockholders
party thereto
    
    10-Q
    
    
    4.2
    
    
    May 6, 20054.3
    
    
    Amended and Restated Registration Rights Agreement, dated as of September 30,
2004, between COMSYS IT Partners, Inc. and certain of the old Venturi
stockholders party thereto
    
    8-A/A
    
    
    4.3
    
    
    November 2, 20044.4
    
    
    Amendment No. 1 to Amended and Restated Registration Rights Agreement dated
April 1, 2005 between COMSYS IT Partners, Inc., and certain of the old
Venturi stockholders party thereto
    
    10-Q
    
    
    4.4
    
    
    May 6, 20054.7#
    
    
    Common Stock Purchase Warrant dated as of April 14, 2003, issued by the
Company in favor of BNP Paribas
    
    8-K
    
    
    99.16
    
    
    April 25, 20034.8
    
    
    Specimen Certificate for Shares of Common Stock
    
    10-K
    
    
    4.6
    
    
    April 1, 200510.1
    
    
    Consent and Ninth Amendment to Credit Agreement, dated as of March 23, 2009,
among COMSYS Services LLC, COMSYS Information Technology Services, Inc., Pure
Solutions, Inc., Plum Rhino Consulting, LLC, Praeos Technologies, LLC, ASET
International Services Corporation, and TAPFIN LLC, as borrowers, COMSYS IT
Partners, Inc., PFI LLC, COMSYS IT Canada, Inc., Econometrix, LLC, as
guarantors, COMSYS Services LLC, acting in its capacity as borrowing agent
and funds administrator for the borrowers, GE Business Financial Services,
Inc., as administrative agent, a lender, sole bookrunner and sole lead
arranger, ING Capital LLC, Allied Irish Banks PLC and BMO Capital Markets
Financing, Inc., as co-documentation agents and as lenders, GMAC Commercial
Finance LLC, as syndication agent and as a lender, and the lenders from time
to time party thereto
    
    8-K
    
    
    10.1
    
    
    March 24, 200931.1*
    
    
    Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 200231.2*
    
    
    Certification of Chief Accounting Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 200232*
    
    
    Certification of Chief Executive Officer and Chief Accounting Officer pursuant
to 18 U.S.C. Section 1350, as adopted, pursuant to Section 906 of the
Sarbanes-Oxley Act of
2002
 30