A Georgia munitions manufacturer has been indicted on charges alleging it sold faulty "stun" grenades to the FBI, including one that injured three agents, federal authorities announced Monday.

Pyrotechnic Specialties Inc., chief executive officer David J. Karlson and three employees are charged with conspiracy, money laundering and conspiracy to defraud the government, the U.S. Attorney's office announced. Court appearances were scheduled Monday.

The indictment said the company contracted with the Department of Defense from 1996 and 2007 to manufacture diversionary grenades, also known as "flash bang" or "stun grenades." The MK141 grenade creates a bright flash and a loud noise to disorient an enemy.

The MK141 was developed by the Navy for use by Navy, Marine and Army forces, with a different model developed for use by civilian law enforcement agencies. The Navy contracts for the MK141 were valued at $15 million.

Four years ago, federal officials said, a design flaw was discovered in the Navy design of the grenade and the Department of Defense issued a stop-work order a year later so the flaw could be corrected.

The indictment alleges that Pyrotechnic Specialties relabeled the devices for resale, claiming they met military standards. The FBI received about 41 shipments of the faulty grenades from 2000 to 2005 at a cost of more than $500,000, it said.

Three FBI agents were seriously injured in October 2004 when a defective grenade prematurely detonated in one agent's tactical vest pocket, the indictment says.

Federal officials said the company no longer manufactures the grenades and it is unlikely that any of the defective grenades were shipped to troops in Iraq and Afghanistan.

Representatives of Pyrotechnics Specialties, of Byron, Ga., did not immediately respond to a call seeking comment Monday afternoon.