SPACEHAB, Inc. , a
leading provider of commercial space services, today announced that the
National Aeronautics and Space Administration (NASA) has exercised a $30.9
million contract option for the company to conduct a new Space Shuttle
research mission.

This Shuttle mission, designated STS-112 (formerly R2) and currently
scheduled to launch in spring 2002, will use SPACEHAB’s Research Double Module
(RDM) as a laboratory for experiments to be conducted by astronauts.
will be the second flight of the RDM.
The inaugural flight of the RDM
( will be Shuttle research mission STS-107,
scheduled to be launched in late 2001.

SPACEHAB is marketing a portion of space on the RDM to commercial users,
including other national space agencies.
The company already has contracted
with the National Space Development Agency of Japan and the German Aerospace
Center to provide $8 million of payload accommodation services on STS-112.

“As a leader in space commerce, we are pleased with our continuing role in
expanding space-based research capabilities and the commercial use of space,”
said Dan Bland, SPACEHAB Senior Vice President for Flight Services.
Shuttle research missions are an excellent opportunity for cutting-edge
researchers to explore the microgravity environment of space and prepare for
future long-duration research activity on the ISS.”

STS-112 also will be the second dedicated Shuttle research mission to be
flown by NASA following the commencement of International Space Station (ISS)
The U.S. Congress has asked NASA to fly one Shuttle research
mission every year, “in order to maintain the continuity and quality of
microgravity research” until the ISS is ready to operate as a full-fledged
laboratory facility.

SPACEHAB’s RDM, measuring 18.4 feet long and 13.5 feet in diameter, adds
approximately 2,200 cubic feet of pressurized volume to the Space Shuttle,
more than quadrupling the living and working area for astronauts onboard.
Astronauts will be able to move between the Shuttle’s middeck area and the RDM
through a pressurized access tunnel.
The RDM can accommodate up to 9,000
pounds of research equipment.

SPACEHAB has flown a smaller Research Single Module
(half the size of the
RDM) on five Shuttle missions, the last being STS-95, former U.S. Senator John
Glenn’s return to flight in October 1998.

NASA exercised the STS-112 flight option on its fixed-price Research and
Logistics Mission Support contract with SPACEHAB.
This contract, established
in 1997, enables NASA to manifest new Shuttle research flights or
International Space Station resupply missions as needed.

Founded in 1984, with more than $100 million in annual revenue, SPACEHAB,
Inc., is a leading provider of commercial space services.
The company is the
first to develop, own, and operate habitat modules and cargo carriers
providing laboratory facilities and resupply capabilities aboard NASA’s Space
It also supports astronaut training at NASA’s Johnson Space Center
in Houston and builds space-flight trainers and mockups.
SPACEHAB’s Astrotech
subsidiary provides commercial satellite processing services at facilities in
Florida and California in support of a range of expendable launch vehicles,
including Lockheed Martin’s Atlas and Boeing’s Delta and Sea Launch rockets.
SPACEHAB’s newest strategic growth initiative, Space Media, Inc. (SMI(TM), a
subsidiary), will bring space into homes and classrooms worldwide with
television and Internet broadcasting from the International Space Station.

This release contains forward-looking statements that are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those projected in such statements. Such risks and
uncertainties include, but are not limited to, whether the company will fully
realize the economic benefits under its NASA and other customer contracts, the
timing and mix of Space Shuttle missions, the successful development and
commercialization of new space assets, technological difficulties, product
demand, timing of new contracts, launches and business, market acceptance
risks, the effect of economic conditions, uncertainty in government funding,
the impact of competition, and other risks detailed in the Company’s
Securities and Exchange Commission filings.