Joseph T. Walker and Nancy Walker - Page 5

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     Shaw, Inc. (B.F. Shaw). Simmel was employed as a purchasing manager              
     with Pullman, Inc. (Pullman).                                                    
               The overbilling and kickback arrangement with Short covered            
     only certain specially fabricated items that Short ordered on behalf             
     of B.F. Shaw from West Jersey. The kickback arrangement did not apply            
     with respect to stock fabricated items that West Jersey sold B.F.                
     Shaw, because the prices West Jersey charged B.F. Shaw with respect to           
     the stock items generally were fixed under a previously established              
     price list for such stock items.                                                 
               Typically, overbilling would occur after Short or Simmel, as           
     purchasing agent for his employer, contacted Mr. Walker or another               
     West Jersey employee, requested a price quote on certain items, and              
     then placed an order for the items. With Short's or Simmel's knowledge           
     and connivance, the price West Jersey later billed and charged B.F.              
     Shaw or Pullman for the ordered items would 'be inflated above the               
     price originally quoted to Short or Simmel. Mr. Walker would record              
     the amounts West Jersey overbilled B.F. Shaw and Pullman (i.e., the              
     difference between the inflated price West Jersey charged and the                
     originally quoted price) in various notebooks he maintained for each             
     company. Pursuant to the overbilling and kickback arrangement with               
     Short, part of the overbilled amounts that West Jersey collected from            
     B.F. Shaw was required to be paid over to Short. Essentially, Short              
     was to receive a 50-percent share of the overbilled amounts that West            
     Jersey collected from B.F. Shaw. Similarly, under the overbilling and            
     kickback arrangement with Simmel, part of the overbilled amounts that            




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