Exhibit 10.37
                                                                   -------------



                               FIRST AMENDMENT TO
                           TERM LOAN A AND B AGREEMENT




Paragon Technologies, Inc., formerly
SI Handling Systems, Inc. and Ermanco Incorporated
600 Kuebler Road
Easton, Pennsylvania 18040
(Hereinafter referred to as "Borrower")

Wachovia Bank, National Association
702 Hamilton Street
Allentown, Pennsylvania 18101
(Hereinafter referred to as "Bank")

         THIS FIRST AMENDMENT TO TERM LOAN A AND B LOAN AGREEMENT is entered
into as of August 4, 2003 by and between Bank and Borrower.

                                    RECITALS

         Bank is the holder of a promissory note (Term Loan B) executed and
delivered by Borrower, dated June 5, 2003, in the original principal amount of
$2,012,500.00 (the "Note"); and certain other loan documents, including without
limitation, a Loan Agreement, dated June 5, 2003 (the "Loan Agreement").

         Borrower and Bank have agreed to modify the terms of the Loan
Agreement.

         In consideration of Bank's continued extension of credit and the
agreements contained herein, the parties agree as follows:

                                    AGREEMENT

ACKNOWLEDGMENT OF BALANCE. Borrower acknowledges that the most recent Commercial
Loan Invoices sent to Borrower with respect to the Obligations under the Note is
correct.

MODIFICATIONS.

1.       The Loan Agreement is hereby modified by deleting all references to
         Term Loan A, the same having been paid and satisfied in its entirety.

2.       The Loan Agreement is hereby modified by deleting the provision
         regarding Minimum Liquidity.

3.       The Loan Agreement is hereby modified by amending the provision
         regarding Prepayment of Other Debt as follows:

Prepayment of Other Debt. Retire any long-term debt entered into prior to the
date of this Agreement at a date in advance of its legal obligation to do so;
provided, however, that (a) at any time without penalty or fee, Borrower may
prepay indebtedness to Bank, subject to the provisions set forth in the Note,
(b) at any time, Borrower may prepay indebtedness to former shareholders of
Ermanco Incorporated (the


<PAGE>



"Subordinated  Debt")  so  long  as  the  outstanding  principal  amount  of the
Subordinated Debt is not less than $1,500,000.00, (c) simultaneously with making
a $500,000.00 principal payment to Bank under the Note, as amended, Borrower may
also make a principal  payment of $500,000.00  under the Subordinated  Debt, and
thereafter, Borrower may make cash payments of interest only on the Subordinated
Debt  provided  that (i)  Borrower  is in full  compliance  with  all  Financial
Covenants as set forth  herein,  including  without  limitation,  the Funds Flow
Coverage  Ratio set forth  herein,  and (ii) said payments do not cause to exist
any  condition  or event  which  constitutes  a Default  (as defined in the Loan
Documents)  or any event  which,  upon the  giving of notice or lapse of time or
both,  may  become a Default,  and (d) at any time after  payment in full of the
obligations under the Note, Borrower may prepay all amounts of Subordinated Debt
then or thereafter outstanding.

4.       Attached hereto as Exhibit "A" is a revised Compliance Certificate
         which is hereby substituted for the prior Compliance Certificate in its
         place and stead.

IN WITNESS WHEREOF, Borrower and Bank, on the day and year first written above,
have caused this Agreement to be executed under seal.

                                  PARAGON TECHNOLOGIES, INC.


                                  By:  /s/ William R. Johnson             (SEAL)
                                     -------------------------------------
                                       William R. Johnson, President


                                  ERMANCO INCORPORATED


                                  By:  /s/ Ronald J. Semanick             (SEAL)
                                     -------------------------------------
                                       Ronald J. Semanick, Treasurer


                                  WACHOVIA BANK, NATIONAL ASSOCIATION


                                  By:  /s/ Peter Gray                     (SEAL)
                                     -------------------------------------
                                       Peter Gray, Vice President








<PAGE>




                                    Exhibit A
                        Quarterly Compliance Certificate
          Borrowers: Paragon Technologies, Inc. and Ermanco Incoporated
                             Account#______________

Wachovia Bank, National Association                       No.   ________________
702 Hamilton Street
Allentown, Pennsylvania 18101                             Date  ________________

I hereby certify that as of ___________ (the "effective date"), the Borrowers
are in full and complete compliance with all terms, conditions and covenants
contained in that certain Loan Agreement dated June 5, 2003, as amended, between
Wachovia Bank, National Association and the Borrowers and all Loan Documents as
referenced therein, as amended, including without limitation, the following
financial covenants:

<TABLE>
<S>      <C>      <C>                                                                                              <C>
1.       Funds Flow Coverage Ratio for the subject quarter is _________ to 1.00, calculated as follows:
                  Quarterly earnings before interest expense, taxes, depreciation, amortization
                  and extraordinary gains (as defined by generally accepted
                  accounting principles) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                  Minus quarterly earnings attributed to SI/BAKER  . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                  Plus quarterly dividends distributed by SI/BAKER . . . . . . . . . . . . . . . . . . . . . . . . $_______________
         (a)      Total . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________

                  Current maturity of long-term debt due and payable for subject quarter . . . . . . . . . . . . . $_______________
                  Quarterly interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
         (b)      Total . . . . . . . . . .. . . . . . . . . . .   . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                           (a) Divided by (b) = ________ to 1.00        [not less than 1.25 to 1.00]

2.                Total Liabilities to Net Worth Ratio is ________ to 1.00, calculated as follows:

         (a)      Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
         (b)      Total Liabilities (excluding subordinated debt)  . . . . . . . . . . . . . . . . . . . . . . . . $_______________
         (c)      Net Worth (a less b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________

         Total Liabilities (excluding subordinated debt) to Net Worth Ratio (b divided by c) is __________ to 1.00
                           [must be not more than 1.75 to 1.00]

3.       Current Ratio is __________ to 1.00, calculated as follows:

         (a)      Current Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
         (b)      Current Liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                           (a) Divided by (b) = ________ to 1.00 [must be not less than 1.20 to 1.00]

4.       Borrower's Aggregate Debt
                  Borrower's Outstanding Debt (List)
                  Obligations to Bank  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                  Obligations to Other Institutional Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                  Obligations to Shareholders, Subsidiaries and Other Affiliates . . . . . . . . . . . . . . . . . $_______________
                  Capital Lease Obligations  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                  Other  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
         (a)      Total Outstanding Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                  Bank Obligations ($___________)
                  Subordinated Notes to former Ermanco shareholders ($__________)
                           [not to exceed $3,000,000.00]


<PAGE>




         (b)      Total  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $_______________
                           (a) minus (b) = $________________ [not
                           to exceed $400,000.00]
</TABLE>



I hereby certify to the best of the undersigned's knowledge, information, and
belief, this above financial information, as derived from each Borrower's
accounting records, as true and correct in all material respects, and that no
material adverse change in the financial condition of either Borrower has
occurred since the effective date of this certification.

                           PARAGON TECHNOLOGIES, INC.

                           By:__________________________________
                           Name:________________________________
                           Title:_______________________________