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     THIRD  AMENDMENT  TO  SERIES  A  SUBORDINATED  CONVERTIBLE  NOTE

     THIS  THIRD  AMENDMENT  TO  SERIES  A  SUBORDINATED  CONVERTIBLE NOTE (this
"Amendment")  is made by and among the undersigned Noteholder and SpaceDev, Inc.
(the  "Corporation") as of the date the Corporation obtains consent from holders
representing  51%  of  the  aggregate  amount  of  the  outstanding  Series  A
Subordinated  Convertible  Notes  referenced and defined in the preamble to that
certain Note Purchase Agreement executed between the parties on October 29, 2002
(the  "Note  Purchase  Agreement").

     PREFACE

     WHEREAS,  the  Corporation  made  an offering of up to $475,000 in Notes to
officers and directors of the Company pursuant to Section 4(2) of the Securities
Act  of  1933,  on  the  terms  and  conditions  set  forth in the Note Purchase
Agreement  and  the  form  of  Note  attached  thereto  as  Exhibit  "A";  and

WHEREAS,  the  Noteholder purchased a Note from the Corporation in the amount of
$50,000  pursuant  to  the  Note  Purchase  Agreement  (the  "Note");  and

WHEREAS, Section 4 of the Note provides that it may only be amended by a vote of
noteholders  representing  51%  of  the aggregate amount of the then outstanding
Subordinated  Convertible  Notes;  and

WHEREAS,  due  to  the  cash position of the Company and in consideration of its
agreement  to  pay  a  portion of the Note in cash and the waiver its conversion
right  to that portion of the amount due, it is the desire of the Noteholder and
the  Corporation  that  the  Note  be  amended  as  provided  herein;

     NOW  THEREFORE,  the  Note  is  amended  as  provided  in  this  Amendment.

     ARTICLE  I

     The parties agree that, pursuant to its right of conversion under Section 2
of  the Note, the Company shall convert 50% of the principal and interest due on
the Note into common stock of the Company on the terms of conversion provided in
the  Note . In exchange for the cancellation of 50% of the warrant issued to the
Noteholder  pursuant to the Note Purchase Agreement (the "Warrant"), the Company
shall pay the remaining principal and increase the interest rate due on the Note
to five percent (5%), payable to the Noteholder by check or wire transfer within
ten (10) days after the execution of this Amendment. To the extent that Warrants
issued to the Noteholder are for an uneven number of shares of common stock, the
Noteholder  shall  retain  the  Warrant  as  to  the  additional  share.

     Upon  execution  of this Amendment, the Noteholder shall surrender the Note
to  the Company for cancellation, and shall surrender the Warrant to Company for
reissuance  as  to 50% of the shares of stock to which it pertains. Upon receipt
of  the original Note and Warrant from the Noteholder, the Company shall deliver
a restricted stock certificate representing the number of shares of common stock
equal  to  50%  of the principal and interest due on the Note on the date hereof
divided  by  the  Conversion  Price  set forth in the Note, and a new Warrant to
purchase  shares  equal  to  50%  of shares underlying the original Warrant (the
"Reissued  Warrant").  The  stock  certificate  and  Reissued  Warrant  shall be
delivered  to  the  Noteholder  within  ten (10) days after the surrender of the
original  Note  and  Warrant  to  the  Company.

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                                   ARTICLE II

     Pursuant  to  this  Amendment,  upon  payment  of  50% of the principal and
interest  due  under  the  Note  and  delivery  of  a Reissued Warrant and stock
certificate as referenced in Article II hereof, the debt represented by the Note
shall  be  extinguished and the Noteholder waives any further claims for payment
under  the  Note.

                                   ARTICLE II

     This  Amendment  to the Note may be executed in any number of counterparts,
each of which, when taken together, shall be deemed the fully executed agreement
between  the  parties.

IN WITNESS WHEREOF, the parties have executed this Amendment effective September
5,  2003.

          CORPORATION:

          SPACEDEV,  INC.


            By: /s/ James W. Benson
            -----------------------
            James  W.  Benson,  CEO

          NOTEHOLDER(S):


          By: /s/ Emery E. Skarupa
          ------------------------
                Emery  E.  Skarupa