IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF FLORIDA PENSACOLA DIVISION ITED STATES OF AMERICA SEALED SUPERSEDING ¥, INDICTMENT ‘Case Number 3:08¢r75/LAC MARK A. O’HAIR, RICHARD SCHALLER, and THEODORE S. SUMRALL THE GRAND JURY CHARGE! COUNT ONE A. INTRODUCTIO! At all times relevant to this indictment: 1. ‘The Air Force Research Laboratory (hereinafter referred to as AF Research Lab), was responsible for planning and executing the science and technology program for the United States Air Force for the discovery, development and integration of war fighting technologies. AF Research Lab accomplished its mission through nine technology directorates located throughout the United States, 2. The AF Research Lab Munitions Directorate (hereinafter referred to as AF Research Lab/MN), located at Eglin Air Force Base, Florida, (hereinafter referred to as, Eglin), developed, demonstrated and transitioned science and technology for air launched munitions for defeating ground fixed, mobile, air and space targets. Returned in open court pursuant to Rule 6(f) = th- oF3. The AF Research Lab/MN was tasked under the Battlefield Airman program with the rapid improvement of war fighting capability. The AF Research Lab/MN contracted with educational institutions, non-profit organizations and private industry for research in tactical capabilities. 4. Defendant MARK A. O° HAIR was a senior electronics engineer with the AF Research Lab/MN. O°HAIR began employment in this position on or about December 3, 2001, following his retirement from the United States Air Force. O’HAIR subsequently transferred to the Battlefield Airman program at Eglin within the AF Research Lab/MN in late 2003/early 2004, and became the program manager for contracts awarded through the Battlefield Airman program. 5. Asprogram manager, defendant MARK A. "HAIR was responsible for evaluating initial proposals submitted by contractors and preparing the technical evaluation of these proposals to support his recommendations for awarding contracts to the contractors. As program manager, O*HAIR was also required to assure that the contract requirements were met by reviewing the contractors” progress under the contract and approving payments to these contractors after the contractors submitted invoices for work completed. During O"HAIR’s tenure as program manager in the Battlefield Airman program, he participated in awarding contracts to various contractors, including Schaller Engineering, Inc. (hereinafter referred to as SEI), which were admi and through the AF Research Lab/MN.6, Defendant RICHARD SCHALLER was the founder and owner of Schaller Engineering, which was a small business located in Northern Florida. Schaller Engineering was started in January 2003. SCHALLER subsequently incorporated Schaller Engine 1g Within the state of Florida, with the entity becoming Schaller Engineering, Inc. (SEI). 7. RICHARD SCHALLER incorporated SEI on January 5, 2005, Corporate filings with the state of Florida dated January 5, 2005, listed SCHALLER as President and Director of SEI, defendant MARK A, O’HAJR as a Director of SEI. and defendant THEODORE S. SUMRALL as Director and Vice President of SEI. Subsequent corporate filings for SEI with the state of Florida dated March 15, 2006, continued to list SCHALLER as President and Director, O"HAIR as Director, and SUMRALL as Director and Vice President of SEI. Corporate filings dated November 17, 2006, deleted reference to SUMRALL and O’HAIR as Officer and/or Directors of SEI. 8. According to the corporate records of SEI, SEI was jointly owned by defendants RICHARD SCHALLER and THEODORE S. SUMRALL and a third individual. 9, SEI’ primary customer and source of income was the AF Research Lab at Eglin. SEI listed Novel Energy Solutions, LLC, Pathfinder Technologies, Inc., and American Electric Vehicles as “strategic partners” on the SEI website.