8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934.

Date of Report (Date of earliest event reported): November 21, 2005

NORTH PITTSBURGH SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania

(State or other jurisdiction of incorporation)

0-13716	25-1485389
(Commission File Number)	(IRS Employer Identification No.)

4008 Gibsonia Road Gibsonia, PA	15044-9311
(Address of principal executive offices)	(Zip Code)

(724) 443-9600

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01. Other Events

On November 21, 2005, Penn Telecom, Inc. (Penn Telecom), a wholly owned subsidiary of North Pittsburgh Systems, Inc. (the Company), issued a press release announcing an agreement in principle between Penn Telecom and Ronco Communications & Electronics, Inc. (Ronco) concerning the intended sale of Penn Telecom’s business telecommunications equipment operations to Ronco. The text of the press release is attached hereto as Exhibit 99.1.

The specific operations being sold engage primarily in selling and maintaining business telecommunications equipment, more specifically Nortel key systems and private branch exchanges. Revenues are earned from selling and installing telecommunications equipment and providing maintenance services for such equipment for business customers.

The following information is being provided for informational purposes. We caution that the operations being sold were not a separate segment of the Company and did not have a formal income statement, and accordingly the impact on net operating income (loss) discussed below involves estimates:

• For the full year 2004, revenues associated with the above-mentioned sales and services were $2.42 million, or 2.2% of the Company’s total consolidated revenues. Revenues associated with the selling and installation of equipment, totaling $1.96 million, were recorded within the “Telecommunication equipment sales” line item of the Company’s Consolidated Statement of Income (income statement) for 2004. Revenues associated with maintenance and other ancillary services, totaling $0.46 million, were recorded within the “Other operating revenues” line item of the income statement for 2004.

For the nine-month period ended September 30, 2005, revenues associated with the above-mentioned sales and services were $1.55 million, or 1.8% of the Company’s total consolidated revenues. Revenues associated with the selling and installation of equipment totaled $1.19 million during the nine-month period ended September 30, 2005, and revenues associated with maintenance and other ancillary services totaled $0.36 million during that same period.

• Direct expenses incurred relating to the cost of equipment sold and the direct cost of labor associated with installing and maintaining the telecommunication systems were $1.33 million for the full year 2004 and $0.86 million for the nine-month period ended September 30, 2005. These expenses were recorded within the “Telecommunication equipment expenses” line item of the income statements for the respective periods.

• The Company estimates that the net operating income (loss) generated from business telecommunications equipment sales and services, after taking into consideration estimates of selling, general, administrative and other costs which are not included in the direct expenses provided above, was nominal for both the full year 2004 and the nine-month period ended September 30, 2005.

• The only identifiable asset specifically associated with the business telecommunications equipment operations is inventory, which was valued at approximately $0.35 million as of September 30, 2005.

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The letter of intent executed between Penn Telecom and Ronco specifies a purchase price of $0.36 million. This price is subject to adjustment pursuant to changes in the Company’s inventory levels and changes in the dollar value of maintenance contracts from the date of the letter of intent to the date of closing. The sale is also contingent upon the finalization and execution of a definitive asset purchase agreement. The Company expects the transaction to close on or about December 31, 2005. The Company does not expect to record any material gain or loss on the transaction.

The information in this Current Report on Form 8-K, including the exhibit, is furnished pursuant to Item 8.01 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

In addition, this filing is not intended to constitute a report under the requirements of Item 1.01 of Form 8-K, “Entry into a Material Definitive Agreement”, or Item 2.01 of Form 8-K, “Completion of Acquisition or Disposition of Assets”, nor will the execution of the asset purchase agreement and consummation of the transaction be considered reportable events under the aforementioned Form 8-K requirements. Based on the revenue, expense, net operating income, identifiable asset and purchase price values discussed above, this transaction would not meet the definition of the term “material definitive agreement” as used in Item 1.01 of Form 8-K or the definition of the term “significant” as used in the rules pertaining to Item 2.01 of Form 8-K. Furthermore, the Company does not anticipate incurring any “material charges” under generally accepted accounting principles associated with this transaction that would necessitate a filing obligation under Item 2.05 of Form 8-K, “Costs Associated with Exit or Disposal Activities”.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit	Description
99.1	Press release issued by Penn Telecom, Inc., dated November 21, 2005.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	North Pittsburgh Systems, Inc.
	(Registrant)
Date: November 21, 2005	/s/ H. R. Brown
	H. R. Brown, President and Chief Executive Officer

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EX-99.1

Exhibit 99.1

NEWS RELEASE

Penn Telecom, Inc.

Penn Telecom and Ronco Agree in Principle

Release: Monday, November 21, 2005

Penn Telecom, Inc. and Ronco Communications & Electronics, Inc. Announce an

Agreement in Principle

Cranberry Township, PA (November 21, 2005)

Penn Telecom, Inc., a telecommunications company serving customers located throughout Western Pennsylvania, is pleased to announce the intended sale of its business telecommunications equipment operations, which specialize in the installation and maintenance of Nortel telephone systems, to Ronco Communications & Electronics, Inc., headquartered in Buffalo, New York, to be effective on or about December 31, 2005. Both companies are well known for their vast experience in selling and installing Nortel business telecommunications equipment and providing critical maintenance plans, which strengthen the reliability and performance of the systems they design and market.

Penn Telecom’s President, Frank Macefe, stated, “This is a positive step for both companies. Penn Telecom can now completely focus its capital and personnel resources on developing and expanding our broadband network services, on our local, long distance, Voice over Internet Protocol (VoIP) and other network related services and on growing our fiber optic infrastructure.” Mr. Macefe noted that Penn Telecom has had a long and mutually beneficial business relationship with Ronco, which has served as Penn Telecom’s Nortel stocking distributor. As a result, Ronco’s purchase of Penn Telecom’s business telecommunications equipment operations will provide continuity of excellent service to Penn Telecom’s Nortel customers.

Ronco’s President, Chris Wasp, commented, “We are extremely excited about the addition of Penn Telecom’s business telecommunications equipment operations which will enhance Ronco’s current expansion into the Pittsburgh market.”

About Penn Telecom, Inc.:

Penn Telecom has been bringing innovative telecom products and services to Pittsburgh and the surrounding areas since 1979 and today offers a complete package of services including broadband, local and long distance service, carrier hotel, and VoIP products for business applications. The company’s ever expanding roster of high-profile clients includes the Pittsburgh Penguins and the Pittsburgh Pirates. Penn Telecom is a subsidiary of North Pittsburgh Systems, Inc. (NPSI) based in Gibsonia, PA. NPSI, with total assets of $156 million, operates an integrated high-technology telecommunications business in Western Pennsylvania that provides competitive and local exchange services, long distance, Internet services and other telecommunication technologies through its subsidiaries, North Pittsburgh Telephone Company, Penn Telecom, Inc., and Pinnatech, Inc. (d/b/a Nauticom). NPSI serves approximately 71,000 access lines in its franchised local exchange territory and over 60,800 access line equivalents in its competitive local exchange carrier edge-out markets.

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About Ronco Communications & Electronics, Inc.:

Founded in 1965, Ronco Communications & Electronics, Inc. is a rapidly expanding major supplier of best-of-class communications technologies. Ronco is a privately-held, woman-owned business headquartered in Buffalo, NY, with offices in Rochester, Utica and Albany, NY; Erie, PA, New England, North and South Carolina, and Florida. Ronco’s over 370 employees consist of sales, engineering, installation, and technical supporting services personnel. Ronco’s 2004 sales revenues exceeded $130 million. Ronco maintains Nortel Elite Advantage Partner status across its geographic footprint and also has the distinction of being one of six Nortel authorized stocking distributors nationwide.

For forty years, Ronco has been a leader in providing innovative communication solutions. Its specialties include: converged telephone systems, data networks, LAN/ WAN, Hosted IVR solutions, IP telephony, carrier and network services, dedicated internet access, specialty communications platforms for medical and educational institutions, and customized professional audio and video systems. Ronco is committed to customer satisfaction through the delivery of comprehensive maintenance plans which are designed to optimize the reliability and performance of their communication systems. Ronco provides technical services that range from on-site 24x7 support to remote Technical Assistance Center (TAC) services, which include equipment alarm monitoring, second level technical support, and on-line PBX enterprise reporting with remote data protection.

Ronco’s success is measured by its ever-growing customer base, which considers Ronco a true “partner in their business.”

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For additional information contact:

Jerry Johnston-Public Affairs Manager

Penn Telecom, Inc.

(724) 443-9534

jerryj@nptc.com

or

Dennis Wilk – EVP Sales & Marketing

Ronco Communications & Electronics, Inc.

716-879-8007

marketing@ronco.net

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