Unassociated Document

0001144204-08-067157.txt : 20081201 0001144204-08-067157.hdr.sgml : 20081201 20081201103811 ACCESSION NUMBER: 0001144204-08-067157 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20081201 DATE AS OF CHANGE: 20081201 GROUP MEMBERS: BCP INVESTMENT LLC GROUP MEMBERS: JOSEPH L. CALIHAN GROUP MEMBERS: STEVEN J. LYNCH SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TOLLGRADE COMMUNICATIONS INC \PA\ CENTRAL INDEX KEY: 0001002531 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-TELEPHONE INTERCONNECT SYSTEMS [7385] IRS NUMBER: 251537134 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-50381 FILM NUMBER: 081221071 BUSINESS ADDRESS: STREET 1: 493 NIXON RD CITY: CHESWICK STATE: PA ZIP: 15024 BUSINESS PHONE: 4122742156 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: BRADFORD CAPITAL PARTNERS CENTRAL INDEX KEY: 0001434759 IRS NUMBER: 251578860 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 133 FREEPORT ROAD CITY: PITTSBURGH STATE: PA ZIP: 15215 BUSINESS PHONE: 412-781-7400 MAIL ADDRESS: STREET 1: 133 FREEPORT ROAD CITY: PITTSBURGH STATE: PA ZIP: 15215 SC 13D/A 1 v133777_sc13da.htm Unassociated Document

SCHEDULE 13D

(Rule 13d-101)

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Under the Securities Exchange Act of 1934

Amendment No. 3

Tollgrade Communications, Inc.

(Name of Issuer)

Common Stock, Par Value $0.20 Per Share

(Title of Class of Securities)

889542106

(CUSIP Number)

Steven J. Lynch

c/o Bradford Capital Partners

133 Freeport Road

Pittsburgh, PA 15215

412-781-7400

with a copy to:

Douglas E. Gilbert

Thorp Reed & Armstrong, LLP

301 Grant Street, 14^th Floor

Pittsburgh, PA 15219

412-394-7711

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

December 1, 2008

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent.

*The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

SEC 1746 (12-91)

___________________
CUSIP No. 889542106	SCHEDULE 13D


1	Names of reporting persons

	Bradford Capital Partners I.R.S. No.:
2	Check the appropriate box if a member of a group
	(a) o
	(b) x
3	SEC Use Only


4	Source of funds

	N/A
5	Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

	o
6	Citizenship or place of organization

	PA

	7	Sole Voting Power

		0
Number of	8	Shared Voting Power
Shares
Beneficially		1,547,053
Owned by	9	Sole Dispositive Power
Each Reporting
Person With		0
	10	Shared Dispositive Power

		1,547,053

11	Aggregate Amount Beneficially Owned by Each Reporting Person

	1,547,053
12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares

	o
13	Percent of Class Represented by Amount in Row (11)

	11.7%
14	Type of Reporting Person

	PN

___________________
CUSIP No. 889542106	SCHEDULE 13D


1	Names of reporting persons

	BCP Investment LLC I.R.S. No.:
2	Check the appropriate box if a member of a group
	(a) o
	(b) x
3	SEC Use Only


4	Source of funds

	N/A
5	Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

	o
6	Citizenship or place of organization

	PA

	7	Sole Voting Power

		0
Number of	8	Shared Voting Power
Shares
Beneficially		1,547,053
Owned by	9	Sole Dispositive Power
Each Reporting
Person With		0
	10	Shared Dispositive Power

		1,547,053

11	Aggregate Amount Beneficially Owned by Each Reporting Person

	1,547,053
12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares

	o
13	Percent of Class Represented by Amount in Row (11)

	11.7%
14	Type of Reporting Person

	OO

___________________
CUSIP No. 889542106	SCHEDULE 13D


1	Names of reporting persons

	Steven J. Lynch I.R.S. No.:
2	Check the appropriate box if a member of a group
	(a) o
	(b) x
3	SEC Use Only


4	Source of funds

	N/A
5	Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

	o
6	Citizenship or place of organization

	United States

	7	Sole Voting Power

		0
Number of	8	Shared Voting Power
Shares
Beneficially		1,547,053
Owned by	9	Sole Dispositive Power
Each Reporting
Person With		0
	10	Shared Dispositive Power

		1,547,053

11	Aggregate Amount Beneficially Owned by Each Reporting Person

	1,547,053
12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares

	o
13	Percent of Class Represented by Amount in Row (11)

	11.7%
14	Type of Reporting Person

	IN

___________________
CUSIP No. 889542106	SCHEDULE 13D


1	Names of reporting persons

	Joseph L. Calihan I.R.S. No.:
2	Check the appropriate box if a member of a group
	(a) o
	(b) x
3	SEC Use Only


4	Source of funds

	N/A
5	Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

	o
6	Citizenship or place of organization

	United States

	7	Sole Voting Power

		0
Number of	8	Shared Voting Power
Shares
Beneficially		1,547,053
Owned by	9	Sole Dispositive Power
Each Reporting
Person With		0
	10	Shared Dispositive Power

		1,547,053

11	Aggregate Amount Beneficially Owned by Each Reporting Person

	1,547,053
12	Check if the Aggregate Amount in Row (11) Excludes Certain Shares

	o
13	Percent of Class Represented by Amount in Row (11)

	11.7%
14	Type of Reporting Person

	IN

ITEM 4. Purpose of Transaction

The text of Item 4 is hereby amended by adding the following language:

“On November 30, 2008, Bradford Capital Partners ("BCP") sent a letter (the "Letter") to the Issuer expressing BCP's potential interest in a transaction whereby each shareholder of the Issuer (other than BCP) would receive between $5.50 and $6.00 per share, resulting in BCP acquiring all of the stock of the Issuer. A copy of the Letter is attached hereto as Exhibit 2 and is incorporated herein by reference. The foregoing references to, and descriptions of, the Letter are qualified in their entirety by reference to the text of Exhibit 2 to this Amendment No. 3.”

ITEM 7. Materials to be Filed as Exhibits

Exhibit 1. Joint Filing Agreement dated May 9, 2008, by and among Bradford Capital Partners, BCP Investment LLC, Steven J. Lynch, Joseph L. Calihan, and the other parties thereto, filed as Exhibit 2 to the Schedule 13D filed by the Reporting Persons on May 9, 2008, and incorporated herein by reference as Exhibit 1 to this Amendment No. 3.

Exhibit 2. Letter dated November 30, 2008 from Bradford Capital Partners to the Issuer.

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

	BRADFORD CAPITAL PARTNERS a Pennsylvania limited partnership By: BCP INVESTMENT LLC its General Partner By: ________________________________________ Name: Stephen J. Lynch Title: President, Secretary and Treasurer Date:

	BCP INVESTMENT LLC a Pennsylvania limited liability company By: ________________________________________ Name: Stephen J. Lynch Title: President, Secretary and Treasurer Date:

	______________________________________ Steven J. Lynch, an individual Date:

	______________________________________ Joseph L. Calihan, an individual Date:

EX-2 2 v133777_ex-2.htm Unassociated Document

November 30, 2008

CONFIDENTIAL

Tollgrade Communications, Inc.

493 Nixon Road

Cheswick, PA 15024

Attention: Mr. Joseph A. Ferrara, President & Chief Executive Officer

Dear Joe:

Bradford Capital Partners (“BCP”) is disappointed that the Board of Directors of Tollgrade Communications, Inc. (the “Company”) has chosen to not constructively engage BCP in discussions on BCP’s indication of potential interest in acquiring the Company, as delivered on November 18, 2008. You have communicated that the Board’s decision to not engage in any discussions at this time is based on (a) the management team’s current focus on executing the new business plan disclosed during the Company’s Third Quarter Earnings Conference Call on October 23, 2008 and (b) the Board’s belief in a future of Tollgrade as an independent public company.

We believe, however, that, with the exception of the financial engineering tactic related to the share repurchase, the strategic direction briefly outlined during the October 23 conference call is not appreciably different from the strategy the Company has been pursuing for the last several years. Further, we believe that strategy for advancing the business, predicated on creation of new software products and partnerships, could take an unacceptably long time to effect and offers uncertain prospects for success, based on Tollgrade’s history. In our view, this status quo is unsustainable. As a publicly-held company, Tollgrade’s share price has declined by 72% over the last five years and by 39% in 2008 alone, despite a recent rise of 62% that we suspect is unrelated to business fundamentals. Based on recent guidance, 2008 revenues of $55 million to $58 million will be 25% to 29% below pro forma 2007 revenues of $77.7 million. As we have indicated in our November 18 letter and in our meetings with you on November 14, 18 and 24, BCP believes that Tollgrade’s Board of Directors should reconsider seriously its recent decision to operate as an independent public company and should pursue instead the sale of the Company to provide liquidity for its shareholders.

BCP has the financial resources to acquire Tollgrade and allow it to operate as a privately-held enterprise with a long-term focus, serving its customers and providing opportunities for its employees. As stated in the November 18 letter, based on the considerable research and analysis we have undertaken, BCP is prepared to discuss an offer to enter into a transaction that would result in each Tollgrade shareholder receiving between $5.50 and $6.00 per share, subject to confirmatory due diligence and negotiation and execution of a mutually acceptable definitive acquisition agreement. This valuation assumes that cash balances net of share repurchases remain essentially at the levels set forth in the Company’s most recent quarterly filing on Form 10-Q. At the mid-point of this range, this price equates to a 41% premium over the average closing prices during the last 60 calendar days. We believe this price and liquidity would be viewed as an attractive proposition by many of the current shareholders of Tollgrade.

Tollgrade Communications, Inc.

November 30, 2008

Page 2 of 2

As we are sure you appreciate, time is of the essence with this proposal. We and our advisors are prepared to work together promptly with the Board to explore making this transaction work for both BCP and Tollgrade’s other shareholders. As a next step, BCP requests that you schedule further meetings with us, our advisors, and your advisors to identify issues that must be resolved and to work together to solve these issues. As soon as practicable thereafter, we request an audience with the senior management team and access to all business and financial information, updated for current results, that was made available during the recently-completed comprehensive strategic review process. We are confident that commitments for the necessary financing also could be obtained quickly and in conjunction with our due diligence review. If we work together cooperatively to finalize a transaction, we believe that the shareholders could receive liquidity for their shares as early as the first quarter of 2009.

We view this proposal to be of significance to Tollgrade shareholders and our intention is to publicly release this letter tomorrow morning. This letter represents an expression of our interest in a transaction, but unless and until a mutually acceptable definitive acquisition agreement has been executed and delivered by BCP and Tollgrade, there will be no agreement between the parties regarding any acquisition by BCP of Tollgrade.

We are enthusiastic about the opportunity to work with Tollgrade and its management, and look forward to further discussions. In order to move forward with this proposal, please respond by the end of the day on Monday, December 1, 2008 with firm times available for us to meet. Depending on your response, BCP reserves the right to undertake any and all steps to ensure that Tollgrade’s shareholders are afforded the opportunity to realize the value and liquidity contained in our proposal.

If you would like to discuss any of the matters raised in this letter, please do not hesitate to call me. We look forward to your favorable reply.

	Sincerely,

	BRADFORD CAPITAL PARTNERS,

	By: BCP Investment LLC, its general partner

	By: _________________________________
	Name: Martin J. Calihan, Authorized Agent