Contributing to pre-tax earnings for the first nine months of 2002 was other income from the licensing of real property during the first half of 2002 of $300,000 and a gain on the sale of excess fixed assets, primarily during the first quarter of 2002 of $94,000, and the application of a recent accounting pronouncement, whereby goodwill is no longer amortized, thereby resulting in an increase to pre-tax earnings of $351,000. The backlog of orders was approximately $9.8 million at the end of the third quarter, versus $11.6 million at the end of the second quarter of 2002.

Bill Johnson, Paragon's Chief Executive Officer, commented, "We are disappointed in our third quarter results following four quarters of profitability. While the sluggish economy has caused a number of our customers to delay projects, we see positive customer interest in certain sectors. We are encouraged by the industry outlook for next year. Also, SI/BAKER is experiencing the best quotation activity we've seen in some time. While quotation activity is strong, delays in order placement are common. In this environment, we've held employment levels until now, but have had to align our costs to the current level of volume. In addition, we continue to remain focused on aggressive sales, marketing, productivity improvement, and cost reduction strategies to achieve gains in operating profit. We continue to invest in product development, yielding the introduction of key new products in both the SI Systems and Ermanco brands. We are also developing exciting new software to enhance productivity at our customers' distribution centers. We believe that Paragon is well positioned to achieve enhanced profitability as economic conditions recover."

The Company will host a conference call to discuss these results on Thursday, November 14, 2002 at 11:00 a.m. EDT. To participate in the call, please dial 1-800-245-3043. The conference ID is Paragon. Simultaneous with the conference call, an audio web cast of the call will be available via a link on the Paragon website, www.paragontechnologiesinc.com.

About Paragon Technologies

Paragon Technologies is a leader in integrating materials handling systems and creating automated solutions for material flow applications. Ermanco's branded conveyor technologies and material handling solutions address the needs of the distribution, assembly, and manufacturing marketplace. SI Systems' branded technologies and material handling solutions address unit assembly handling and order fulfillment applications. Paragon Technologies' Quality Management System at its Easton, Pennsylvania location is certified to the ISO 9001 standard. The scope of the Quality Management System governs the design, manufacture, assembly, installation, and servicing of automated materials handling and distribution systems. One of the top materials handling systems suppliers worldwide, Paragon's leading clients include the United States Postal Service, General Motors, IBM, BMG, Daimler Chrysler, Johnson & Johnson, Ford, Peterbilt, Harley-Davidson, Walgreens, and Clark Equipment.

Certain statements contained herein are not based on historical fact and are to be viewed as "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words or phrases used in this News Release denoting the anticipated results of future events, such as " believe," "affords us," "grow," "will be," "will spur additional opportunities," and similar expressions that denote optimism and uncertainty, are intended to identify such forward-looking statements. SI Handling's actual results, performance, or achievements could differ materially from the results expressed in, or implied by, such "forward-looking statements" if the factors on which their conclusions are based do not conform to their expectations.