SPACEHAB, Inc. 907 Gemini Houston, Texas 77058 1.713.558.5000 fax: 1.713.558.5960 www.spacehab.com FOR IMMEDIATE RELEASE ASTROTECH AWARDED ATK ARES I-X FIRST STAGE PROCESSING CONTRACT Vehicle Hardware Preparation Marks F

ASTROTECH AWARDED ATK ARES I-X FIRST STAGE

Preparation Marks First Phase into Next Generation Spacecraft Production

HOUSTON (October 20, 2008) SPACEHAB Inc. (NASDAQ:

SPAB) announced today that its Astrotech subsidiary located in Titusville,

Florida was awarded a $1.17 million contract from Alliant Techsystems (NYSE:

ATK) in support of ATK s planning and assembly of Ares I-X first stage hardware

to be flown during the 2009 test flight

for the development of NASA s Ares I launch vehicle.

The ATK contract specifies that Astrotech will provide

facilities, facility operations personnel and related facility infrastructure,

including services required to transport hardware to Kennedy Space Center. ATK

is the prime contractor for the Ares I first stage, which is a reusable

five-segment solid rocket booster derived from the Space Shuttle s four-segment

Ares I-X will utilize a single, four-segment reusable solid

rocket booster with a simulated fifth segment. The 2009 test flight is a major

milestone for NASA s next-generation spacecraft and launch vehicle system. It

will provide critical data to provide risk mitigation during development and

ensure the safety and reliability of the Ares I spacecraft that will ultimately

ferry astronauts to the moon, Mars, and destinations beyond.

We are honored to have the opportunity to work with ATK,

and provide support services during this momentous demonstration flight,

explains Ret. General Lance Lord, Astrotech Chief Executive Officer. This contract signifies an important

alliance between Astrotech and ATK, and we are extremely proud to be involved

at the grassroots level supporting the newest U.S launch system. We look forward to participating in this

historic program, and expanding this partnership into other programs, which

will leverage the combined expertise of two pioneering aerospace companies.

General Lord joined Astrotech in June, bringing almost 40 years of

strategic command experience to Astrotech s growing repertoire of competencies.

During his military career, General Lord led more than 39,700 space

professionals who provided combat forces to North American Aerospace Defense

Command and U.S. Strategic Command. His

prodigious career also includes commanding two ICBM wings in Wyoming and North

Dakota, as well as commanding a space wing responsible for satellite launch and

ballistic missile test launch operations in California.

As part of ATK s contract, Ares I-X hardware will utilize Astrotech s

unique facilities including 150,000 square feet of clean-room space, the

capability to handle solid propellants, and the various ground processing

services offered at the Titusville facility.

Astrotech is now consolidated into three cohesive business

units ground operations, engineering services and flight operations,

continues General Lord, which positions and readies us to provide

comprehensive end-to-end mission assurance services, and expanded commercial

offerings to a much broader market. We have a 23-year legacy of superb customer

service that will be our benchmark as we expand our services.

The Astrotech Space Operations facilities, located in Titusville,

Florida, Vandenberg Air Force Base, and the Sea Launch Home Port facilities in

California, has provided unmatched spacecraft processing services to its

domestic and foreign customers, in both government and commercial markets since

1985. Successfully processing 250

spacecraft with 100% on-time completion and zero launch failures, Astrotech

provides services in advance planning; use of unique facilities; and,

spacecraft checkout, encapsulation, fueling, transport, and remote control

SPACEHAB is a commercial and entrepreneurial force in the

space industry providing a full spectrum of products and services to both the

government and private sectors. The Company offers spacecraft pre-launch

processing facilities and services, production of valuable commercial products

in space, development and extension of space-based products to the consumer

market, space access and payload integration services program and engineering

support ranging from development and manufacturing of flight hardware to large

scale government project management.

in this document may contain forward-looking statements that are made pursuant

to the Safe Harbor provisions of the Private Securities Litigation Reform Act

of 1995. Such forward-looking statements are subject to risks, trends, and

uncertainties that could cause actual results to be materially different from

the forward-looking statement. These factors include, but are not limited to,

continued government support and funding for key space programs, product

performance and market acceptance of products and services, as well as other

risk factors and business considerations described in the company s Securities &

Exchange Commission filings including the annual report on Form 10-K. Any

forward-looking statements in this document should be evaluated in light of

these important risk factors. The Company assumes no obligation to update these

forward-looking statements.

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