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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-K/A



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(Mark One)

|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------



For the fiscal year ended June 30, 2005



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the transition period from  to



Commission File No. 0-27206



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SPACEHAB, Incorporated

(Exact name of registrant as specified in this charter)



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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Washington                                                     |  | 91-1273737                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)



12130 Highway 3,
Building 1

Webster, Texas 77598-1504

(713) 558-5000



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Securities Registered pursuant to Section 12(b) of the Act:



|                    |  |                                          
|------------------- |  | -----------------------------------------
|Title of each class |  | Name of each exchange on which registered
|Common Stock        |  | NASDAQ National Market                   
|(no par value)      |  |                                          



Securities
Registered pursuant to Section 12(g) of the Act: None



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Indicate by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.    YES  x    NO ̈



Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form
10-K. ̈



Indicate by check mark whether the registrant is an accelerated filer (as defined in rule 12b-2 of the Exchange
Act).    YES ̈NO  x



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of
the Act).    YES ̈NO  x



The aggregate market value of the registrants voting and non-voting common equity held by
non-affiliates of the registrant, based upon the closing price of such stock on the NASDAQ National Market on such date of $2.13 was approximately $26,893,227 as of December 31, 2004.



As of September 13, 2005, 12,671,179 shares of the
registrants common stock, no par value, were outstanding.



DOCUMENTS INCORPORATED BY REFERENCE:



|                                          |  |                                  
|----------------------------------------- |  | ---------------------------------
|Proxy Statement for the Annual Meeting of |  | Parts I, II, and III of Form 10-K
|Stockholders to be held December 1, 2005. |  |                                  



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EXPLANATORY NOTE



Spacehab Inc. is amending their Fiscal Year 2005 Form 10-K as a result of a correction to a previously reported Decrease to Accounts
Payable in the Statement of Cash Flows in the amount of $1,554,000 which should actually be reported as a decrease in the amount of $1,504,000. There is no change in cash used in operating activities as disclosed in the initial filing.
Additionally, we are making other adjustments to the document as referenced under the Liquidity and Capital Resources section of the companys MD&A section. Reference the following pages for the updated information as filed. The
Company has also revised the date of the Annual Meeting of Stockholders to December 1, 2005 as referenced above.



Note: There are no other changes to the original Form 10-K filing other than those outlined in this document. This Form 10-K/A does not reflect events occurring after the
filing of the original Form 10-K, or modify or update the disclosures therein in any way other than as required to reflect the amendment set forth below.



1



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The Presidents fiscal year 2006 budget request of $16.5 billion identifies what is needed to continue transforming
the U.S. civil space program. The request, which represents a 2.4% increase from 2005, supports critical national needs and technologies, including investments in next generation earth observing satellites, vehicle systems and educational programs
for the next generation of explorers. The budget assumes an ongoing effort to retool NASAs institution based on best achieving its priorities for the Vision for Space Exploration. This will require adjustments to work-force skill distribution,
physical capital, facilities and innovations in management structure.



The main
beneficiary of the 2006 budget is NASAs Exploration Systems, with funding up from $2.7 billion to $3.2 billion, representing a 17.9% increase. The role of Exploration Systems is to develop a set of new capabilities, supporting technologies and
foundational research that enables sustained and affordable human and robotic exploration. The budget proposal also maintains the return-to-flight of the space shuttle fleet as a top priority and includes $1.9 billion for the International Space
Station with funding support for an enhanced crew size of up to six prior to completion of assembly. This level of funding should allow NASA to meet obligations for international partners as well. We believe that the 2006 budget reaffirms the
Presidents commitment and provides NASA the next step in implementing its strategic vision. Based on NASAs estimates, the budget is expected to increase to over $18.0 billion by fiscal year 2010.



In June 2004 the Presidents Commission on Implementation of United States Space
Exploration Policy issued its final report of conclusions and recommendations gathered from public testimony of 96 individuals and over 6,000 written inputs. The commissions objective was to examine and make recommendations on
implementing the new national vision. The commission found overwhelming public support (public comments supporting the vision compared to those against the program by 7 to 1) for the Vision for Space Exploration. Throughout the report, the
commission found and emphasized the need for a greater role of commercial enterprise in the space exploration program.



Futron study statistics for the global space industry reflect strong government spending and consumer demand for satellite services, producing growing revenues of $78.6
billion in 2001, $86.1 billion for 2002 and $91.0 billion in 2003. Global space industry revenues have continued to increase, growing at a rate of approximately 7.6% annually over the two years from 2001 to 2003, even though some markets, such as
the commercial satellite sector, have experienced a significant decline in recent years. Satellite services and ground equipment manufacturing have shown the greatest growth, while satellite manufacturing and the launch industry have shown the
greatest declines. Government spending and strong consumer demands for satellite video services were responsible for almost all of this growth. Although industry revenues have been positive, other indicators, such as prices, profit margins, stock
prices and new orders, have experienced negative trends and reflect significant financial stress in the industry.



Risk Factors



The risks and uncertainties described below are not the only risks facing us. Additional risks not presently known to us or which we consider immaterial based on information currently available to us may also
materially adversely affect us. If any of the following risks or uncertainties actually occur, our business, financial condition, and results of operations could be materially adversely affected.



Risks Related to Our Business



In 2005 our SFS business unit derived over 88% of its revenues, which represented
approximately 63% of our fiscal year 2005 consolidated revenues, from the use of our modules and integrated cargo carriers by the space shuttle fleet, which could be retired by 2010.



Our modules and integrated cargo carriers have been specifically designed to enhance the
capabilities of the space shuttle and, therefore, our current SFS business is highly dependent on the availability of the space shuttle fleet. President Bushs vision for U.S. space exploration envisions that the United States will fulfill its
commitments to international partners and complete its work on the ISS by 2010. The shuttle is currently scheduled to be retired after its work on the station is complete. Our single module is currently scheduled to fly on two space shuttle
missions. Since the shuttles chief purpose is anticipated to be assisting in the completion of the assembly of the station, our modules may not be used for many additional missions, if any. We currently own one single module and a second
module that can be added to our single module in order for it to be configured as a double module. We invested approximately $72.5 million in the design and construction of these two modules. We do not anticipate being able to sell or use these two
modules or use our integrated cargo carriers following the retirement of the space shuttle fleet. If our SFS business is unable to develop projects or services that will be used by the crew exploration vehicle and other spacecraft that will replace
the shuttle fleet, our financial condition and results of operations will be materially adversely affected.



2



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Our SFS business unit depends on regular space shuttle flights.



In addition to the scheduled retirement of the space shuttle fleet, the space shuttle fleet
has been grounded for extended periods numerous times. The space shuttles return to flight for the first time since the Space Shuttle Columbia was lost on re-entry was July 2005. The space shuttle fleet is currently grounded while NASA
investigates the causes of the loss of insulating foam on the shuttle external liquid fuel tank that occurred on the July 2005 mission. NASA has tentatively established a return to flight date of March 2006. This date is dependent upon NASA
successfully implementing a solution to the insulating foam problem. All missions aboard the space shuttle were previously suspended from January 1986 to September 1988, pending the redesign of certain of its subcomponents which had caused the loss
of the Space Shuttle Challenger. The space shuttle fleet has also been temporarily grounded for shorter periods of time on several occasions. No assurances can be made that the space shuttle will not be grounded, that future missions of the
space shuttle will not be delayed, or that NASA will launch the number of space shuttle missions currently scheduled. There are three space shuttles in operation. Failure to have access to the space shuttle, either through technical difficulties
affecting the entire fleet or the loss of an individual space shuttle, would have a material adverse effect on our financial condition and results of operations.



We have incurred, and expect in the future to incur, significant legal costs related to the loss of our research double module in the
Columbia tragedy.



On February 1, 2003 we lost our RDM in the
Columbia tragedy. We sought indemnification from NASA in the amount of $87.7 million for the value of this module and related equipment that was destroyed. We received insurance proceeds of $17.7 million and $8.0 million in indemnification
from NASA in connection with the loss of this module. We have filed an appeal of NASAs decision to deny our claim for indemnification in excess of $8.0 million with the Armed Services Board of Contract Appeals and a tort claim against NASA
seeking damages of $79.7 million for the loss of the RDM. In pursuing our appeal and tort claims, we will be required to expend material amounts on legal fees, but may not recover any additional amounts from NASA. Lloyds, our insurer, is
entitled to participate in a recovery against NASA, if any, net of legal costs, in an amount up to $17.7 million.



Since we do not intend to build any more modules, if our single module is lost, our net income from operations associated with space shuttle missions would be
materially reduced and our insurance coverages may not be adequate.



Our second module is designed to convert our single module into a double module configuration. It can only be used in connection with our remaining single module. If our single module is lost as a result of another shuttle accident, we will
not have any modules available for future shuttle missions. If we only lost our single module, we could not recover insurance proceeds for the second module, which is not usable without the single module. Although our modules are insured for
replacement value if they are lost, we currently do not intend to build any additional modules due to the potential retirement of the space shuttle fleet in 2010 and the inability of our modules to be used on other spacecraft. As a result, the loss
of one or both of our modules would materially reduce the amount of income we could potentially generate from the remaining shuttle missions. In addition, the loss of another space shuttle could result in the termination of the shuttle program
earlier than is currently expected. In the event of another catastrophic space tragedy in which our modules or carriers cause damage to third parties, our liability may exceed the limits of our liability coverage. The loss of one or both of our
modules will materially reduce our net income from operations associated with shuttle missions and will have a material adverse affect on our financial condition and results of operations.



Since we are dependent on NASA as a customer, if the products and services we are
currently developing for use by NASAs successor to the space shuttle program are not used, our financial condition and results of operations will be materially adversely affected.



Approximately 81% of our fiscal 2005 revenue was generated from ten contracts supporting
NASA. We anticipate that revenue from NASA-related projects will continue to account for a material amount of our revenue in the future. There are no assurances, however, that NASA will require our module or integrated cargo carrier services in the
future. We currently anticipate that NASA will not use our modules as much as they have in the past. Even if NASA continues to use our modules and ICCs to the same extent that it did prior to the suspension of shuttle flights following the
Columbia disaster, these products will become obsolete when the space shuttle is retired. See In 2005, our Flight Services business unit derived over 88% of its revenues, which represented approximately 63% of our fiscal year 2005
consolidated revenues, from the use of our modules and integrated cargo carriers by the space shuttle fleet, which could be retired by 2010. Our failure to execute new contracts supporting NASA for use of our modules and carriers could have a
material adverse effect on our financial condition and results of operations.



3



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Liquidity and Capital Resources



As of June 30, 2005 we had cash on hand of $8.3 million, including $1.0 million in restricted cash. Our $5.0 million revolving credit
facility had no outstanding borrowings as of June 30, 2005. Our primary sources of liquidity in 2006 are our available resources and anticipated cash flow from operations. The principal uses of cash flow that affect our liquidity position
include both operational expenditures and debt service payments. We are focused on increasing cash flow and on managing cash effectively through limiting cash investments in long-term assets. Our ability to maintain sufficient liquidity in the
future will depend on a number of factors, including our ability to acquire future business, control our costs and manage capital expenditures, the return to flight of the space shuttle, and the continued activity in the commercial and governmental
satellite launch industry.



We expect that our cash on hand and operating cash
flows through fiscal year 2006 will be sufficient to satisfy our capital expenditures, debt maturities, interest expenses, and operating commitments. In February 2005 we entered into a new $5.0 million revolving credit facility, replacing our
previous revolving credit facility that has a term of one year. This new revolving credit facility is secured by our accounts receivable and funds available under the facility are limited to 80% of eligible accounts receivable. The interest rate for
the term loan is prime plus one percent. Under the credit facility, we are subject to various financial and other covenants, including a minimum tangible net worth covenant, a cash flow covenant, and a secured debt coverage covenant. As of
June 30, 2005 there was $5.0 million available for borrowings under this credit facility and restricted cash of $0.4 million. We were required to maintain a restricted cash balance of $0.4 million as of June 30, 2005 because we did
not satisfy the minimum tangible net worth covenant in our credit facility as of June 30, 2005.



Over the longer term we believe that the space shuttle return to flight and the Presidents Vision for Space Exploration will lead to increased activity and related cash flows from operations for our SFS business
unit. We expect additions to our contract with Lockheed Martin for ISS configuration hardware and contract additions in our spacecraft processing business, reflecting increased activity in the space exploration and commercial satellite industries.
However, there can be no assurance that we will be able to win future contracts with NASA, other national space agencies, or commercial space enterprises, or to successfully exploit other business opportunities.



Cash Flows From Operating Activities. Cash provided by (used in)
operations for the years ended June 30, 2005, 2004 and 2003 was ($7.2) million, $5.3 million and $2.1 million, respectively. The significant items affecting the differences in cash flows from operating activities in fiscal year 2005 as compared
to fiscal year 2004, and fiscal year 2004 compared to fiscal year 2003 are discussed below:



Fiscal Year 2005 Compared to 2004. For the fiscal year 2005 compared to fiscal year 2004, the significant items affecting cash provided by operating activities were:



| |  | Net income for fiscal year 2005 was $5.2 million as compared to net income for fiscal year 2004 of $2.1 million. Included in net income for fiscal year 2005 is $7.7 million
recognized as a net recovery of a previously reported non-recurring loss for the loss of our RDM.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | For fiscal year 2004 we received $17.5 million due to the Boeing contract termination. In addition, we recorded a non-cash charge of $8.3 million for impairment of goodwill at our
Astrotech and SGS business units. We recorded a non-cash valuation allowance charge of $1.8 million for our investment in Guigne. We also recorded a non-cash charge of approximately $0.6 million due to the loan repayment.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Depreciation and amortization for fiscal year 2005 was $0.4 million less compared to fiscal year 2004, primarily due to a portion of assets reaching the end of their useful lives
offset by decreased depreciation expense due to the sale of our SPPF facility at Cape Canaveral, Florida.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Changes in assets for fiscal year 2005 used cash from operations of $7.9 million. This change is primarily due to an increase in accounts receivable of $9.0 million and an increase
in prepaid expenses of $0.2 million, which were partially offset by a decrease in other assets of $1.3 million. The increase in accounts receivable is primarily due to increased billings on the Cargo Mission Contract due to contract billable
milestones being delivered and increased project work on space shuttle related contract work. The decrease in other assets is primarily due to a decrease in deferred mission costs for the Japanese Experiment Thermal Incubator Service contract due to
the launch of the first mission in July 2004 and the subsequent on-orbit operations. For fiscal year 2004 change in assets used cash from operations of $1.5 million primarily from an increase in accounts receivable of $1.1 million.
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Changes in liabilities for fiscal year 2005 used cash from operations of $1.8 million. This change is due primarily to the decreases in accounts payable and accrued expenses of
$1.5 million which include the recording of the $0.5 million liability related to the Lloyds settlement and the decrease in deferred revenue of
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



4



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$5.4 million. The decrease in deferred revenue is primarily due to the first launch for the Japanese
Experiment Thermal Incubator Service contract during fiscal year 2005 and subsequent on-orbit operations. The decreases in accounts payable, accrued expenses, and deferred revenue was offset by an increase in accrued subcontract costs and other of
$5.1 million which is due to increased shuttle related activities. For fiscal year 2004 changes in liabilities used cash in operations of $11.8 million, primarily due to a decrease in accounts payable and accrued expenses of $4.6 million and a
decrease in deferred revenue of approximately $8.9 million primarily due to revenue recognition for STS-116 and NASAs planned dedicated research mission that was previously scheduled to follow STS-107. These decreases were partially offset by
an increase in accrued subcontracting costs of $1.7 million.



Fiscal Year
2004 Compared to 2003. For the fiscal year 2004 compared to fiscal year 2003, the significant items affecting cash provided by operating activities were:



| |  | Net income for fiscal year 2004 was $2.1 million as compared to a net loss of recorded in the prior fiscal year of $81.8 million.
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| |  | For fiscal year 2004 we received $17.5 million due to the Boeing contract termination. In addition, we recorded a non-cash charge of $8.3 million for impairment of goodwill at our
Astrotech and SGS business units. We recorded a non-cash valuation allowance charge of $1.8 million for our investment in Guigne. We also recorded a non-cash charge of approximately $0.7 million due to the loan repayment.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Charges for depreciation and amortization in fiscal year 2004 was $3.5 million less than depreciation and amortization in fiscal year 2003 primarily resulting from the loss of our
RDM in fiscal year 2003.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Changes in assets and liabilities for fiscal year 2004 consumed cash from operations of $13.3 million, primarily due to increases in accounts receivable and reductions in accounts
payable as compared to use of $3.7 million in fiscal year 2003 where a decrease in accounts receivable of $7.0 million partially offset the reductions in accounts payable and accrued subcontracting costs. Deferred flight revenue decreased
approximately $8.9 million in each fiscal year resulting from the closeout of the Research and Logistics Mission Support contract and the startup of the Japanese Experiment Thermal Incubator Service contract.
|- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Cash Flows From Investing Activities. For the years ended June 30, 2005,
2004 and 2003, cash flows provided by investing activities were $17.7 million, $5.0 million and $3.0 million, respectively. The significant items affecting the differences in cash flows from investing activities in fiscal year 2005 compared to
fiscal year 2004 and fiscal year 2004 compared to fiscal year 2003 are discussed below:



Fiscal Year 2005 Compared to 2004. For the fiscal year 2005 compared to fiscal year 2004, the significant items affecting cash provided by investing activities were:



| |  | There were property and equipment purchases of $3.4 million for fiscal 2005 as compared to $2.1 million for fiscal year 2004. For fiscal year 2005 cash flows from investing
activities included the purchase of the Headquarters facility that was subsequently sold and leased back from the new landlord.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | For fiscal year 2005 cash flows from investing activities were generated from the sale of short-term investments of $6.6 million as compared to sales of such short-term investments
of $7.4 million for the fiscal year 2004.
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| |  | For fiscal year 2005 cash flows from investing activities included $8.2 million received from NASA under the Research and Logistics Mission Support contract indemnification clause
for the loss of our RDM.
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| |  | For fiscal year 2005 cash flows from investing activities included $6.8 million from the sale of our SPPF and Headquarters facilities.
|- |  | --------------------------------------------------------------------------------------------------------------------------------------



Fiscal Year 2004 Compared to 2003. For the fiscal year 2004 compared to fiscal year
2003, the significant items affecting cash flows in investing activities for 2004 were the sale of $7.4 million of short term investments offset by the use of $2.1 million cash flow for purchases of property and equipment, payments for building
under construction and payments for flight assets under construction. The significant items affecting cash flows used in investing activities for 2003 were purchase of short term investments of $14.0 million and $2.1 million cash flow for purchases
and payments, offsets with insurance proceeds of $17.7 million resulting from the loss of our RDM on the Space Shuttle Columbia.



5



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Item 8. Financial Statements and Supplementary Data.



Report of Independent Registered Public Accounting Firm



The Board of Directors and Stockholders



SPACEHAB, Incorporated and Subsidiaries:



We have audited the accompanying consolidated balance sheets of SPACEHAB, Incorporated and
subsidiaries (the Company) as of June 30, 2005 and 2004, and the related consolidated statements of operations, stockholders equity and comprehensive income (loss) and cash flows for the years then ended. These consolidated
financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.



We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform an audit of its internal control
over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Companys internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used, and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the consolidated financial statements referred to above present fairly, in
all material respects, the consolidated financial position of the Company as of June 30, 2005 and 2004, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally
accepted in the United States of America.



/s/ Grant Thornton LLP



Houston, Texas

September 8, 2005



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Report of Independent Registered Public Accounting Firm



The Stockholders and Board of Directors



SPACEHAB, Incorporated and Subsidiaries:



We have audited the accompanying consolidated statements of operations, stockholders
equity and comprehensive income (loss), and cash flows of SPACEHAB, Incorporated and subsidiaries (the Company) for the year ended June 30, 2003. These financial statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on these financial statements based on our audit.



We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.



In our opinion, the financial statements referred to above present fairly, in all material
respects, the consolidated results of operations and cash flows of SPACEHAB, Incorporated and subsidiaries for the year ended June 30, 2003, in conformity with U.S. generally accepted accounting principles.



/s/ Ernst & Young LLP

McLean, Virginia

August 20, 2003



7



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SPACEHAB, INCORPORATED AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(In thousands)



|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|-------------------------------------------------------------------------------------------------- |  | ---------------------------- | ------ | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                                                                                   |  | Twelve Months Ended June 30, |       
|                                                                                                   |  | 2005                         |        |   | 2004 |   |         | 2003 | 
|Cash flows from operating activities                                                               |  |                              |        |   |      |   |         |      |  |   |         |  
|Net income (loss)                                                                                  |  | $                            | 5,249  |   |      | $ | 2,075   |      |  | $ | (81,775 | )
|Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: |  |                              |        |   |      |   |         |      |  |   |         |  
|Nonrecurring item, net loss (recovery) related to RDM                                              |  |                              | (8,244 | ) |      |   |        |      |  |   | 50,268  |  
|Goodwill impairment                                                                                |  |                              |       |   |      |   | 8,274   |      |  |   | 11,925  |  
|Impairment of investment in Guigne                                                                 |  |                              |       |   |      |   | 1,800   |      |  |   | 16,143  |  
|Loss on interest rate swap                                                                         |  |                              |       |   |      |   | (613    | )    |  |   |        |  
|Depreciation and amortization, including deferred debt issuance                                    |  |                              | 5,526  |   |      |   | 5,883   |      |  |   | 9,385   |  
|Write-off of debt placement fees                                                                   |  |                              | 9      |   |      |   | 567     |      |  |   |        |  
|Loss on asset sales and write-offs                                                                 |  |                              | 3      |   |      |   | 615     |      |  |   |        |  
|Recognition of deferred gain                                                                       |  |                              | (33    | ) |      |   |        |      |  |   |        |  
|Other                                                                                              |  |                              |       |   |      |   |        |      |  |   | (146    | )
|Changes in assets and liabilities:                                                                 |  |                              |        |   |      |   |         |      |  |   |         |  
|(Increase in) decrease in accounts receivable                                                      |  |                              | (9,028 | ) |      |   | (1,098  | )    |  |   | 7,022   |  
|(Increase in) decrease in prepaid expenses and other current assets                                |  |                              | (198   | ) |      |   | (152    | )    |  |   | 120     |  
|(Increase) decrease in other assets                                                                |  |                              | 1,341  |   |      |   | (272    | )    |  |   | (21     | )
|Decrease in deferred revenue                                                                       |  |                              | (5,429 | ) |      |   | (8,864  | )    |  |   | (8,861  | )
|(Decrease) increase in accounts payable and accrued expenses and accounts payable-EADS             |  |                              | (1,504 | ) |      |   | (4,596  | )    |  |   | 575     |  
|(Decrease) increase in accrued subcontracting services and other                                   |  |                              | 4,876  |   |      |   | 1,654   |      |  |   | (2,521  | )
|Increase in long-term contracts costs and other liabilities                                        |  |                              | 279    |   |      |   |        |      |  |   |        |  
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Net cash (used in) provided by operating activities                                                |  |                              | (7,153 | ) |      |   | 5,273   |      |  |   | 2,114   |  
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Cash flows from investing activities                                                               |  |                              |        |   |      |   |         |      |  |   |         |  
|Payments for flight assets under construction                                                      |  |                              |       |   |      |   | (609    | )    |  |   | (161    | )
|Purchases of property, equipment and leasehold improvements                                        |  |                              | (3,429 | ) |      |   | (1,481  | )    |  |   | (1,297  | )
|Proceeds received from sale of property and equipment                                              |  |                              | 6,767  |   |      |   | 133     |      |  |   | 125     |  
|Proceeds from sales (purchases) of investments                                                     |  |                              | 6,641  |   |      |   | 7,406   |      |  |   | (14,047 | )
|Increase in restricted cash                                                                        |  |                              | (540   | ) |      |   | (430    | )    |  |   |        |  
|Proceeds from insurance                                                                            |  |                              |       |   |      |   |        |      |  |   | 17,667  |  
|Proceeds from contract indemnification                                                             |  |                              | 8,244  |   |      |   |        |      |  |   |        |  
|Proceeds from state grant                                                                          |  |                              |       |   |      |   |        |      |  |   | 750     |  
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Net cash provided by investing activities                                                          |  |                              | 17,683 |   |      |   | 5,019   |      |  |   | 3,037   |  
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Cash flows from financing activities                                                               |  |                              |        |   |      |   |         |      |  |   |         |  
|Proceeds from issuance of common stock                                                             |  |                              | 138    |   |      |   | 305     |      |  |   | 151     |  
|Increase in deferred financing                                                                     |  |                              | (456   | ) |      |   |        |      |  |   |        |  
|Purchase of treasury stock                                                                         |  |                              |       |   |      |   | (6      | )    |  |   | (111    | )
|Net borrowings (repayments) under revolving loan payable                                           |  |                              | (1,445 | ) |      |   | 1,445   |      |  |   | (2,150  | )
|Repayment of mortgage loan                                                                         |  |                              | (1,946 | ) |      |   | (9,494  | )    |  |   | (2,039  | )
|Repayment of interest rate swap                                                                    |  |                              |       |   |      |   | (1,333  | )    |  |   |        |  
|Payment of convertible notes payable to shareholder                                                |  |                              |       |   |      |   | (2,004  | )    |  |   | (1,862  | )
|Payment of note payable                                                                            |  |                              |       |   |      |   |        |      |  |   | (218    | )
|Payment of minority interest                                                                       |  |                              |       |   |      |   |        |      |  |   | (315    | )
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Net cash used in financing activities                                                              |  |                              | (3,709 | ) |      |   | (11,087 | )    |  |   | (6,544  | )
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Net change in cash and cash equivalents                                                            |  |                              | 6,821  |   |      |   | (795    | )    |  |   | (1,393  | )
|Cash and cash equivalents at beginning of period                                                   |  |                              | 506    |   |      |   | 1,301   |      |  |   | 2,694   |  
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  
|Cash and cash equivalents at end of period                                                         |  | $                            | 7,327  |   |      | $ | 506     |      |  | $ | 1,301   |  
|                                                                                                   |  |                              |        |   |      |   |         |      |  |   |         |  



See accompanying notes to consolidated
financial statements.



8



---

Cash and Cash Equivalents



The Company considers short-term investments with original maturities of three months or less to be cash equivalents. Cash
equivalents are primarily made up of money market investments and overnight repurchase agreements recorded at cost, which approximate market value.



Restricted Cash



Restricted cash represents cash that is not readily available for general purpose cash needs. Restricted cash of $0.9 million at June 30, 2005
reflected amounts restricted due to loan covenant of $0.4 million and cash restricted for payment of mortgage loan payable of $0.5 million.



Investments



We account for investments in accordance with Statements of Financial Accounting Standards No. 115, Accounting for Certain Investments in Debt
and Equity Securities. The Company designated all of its investments as of June 30, 2004 to be available for sale and classified these as current based on their intent to use these securities in operations during fiscal year 2005.



Available-for-sale securities are recorded at fair value on
the balance sheet, with the change in fair value during the period excluded from earnings and recorded as a component of other comprehensive income. As of June 30, 2004 the fair market value of these securities approximated cost. Maturities of
the debt securities held by the Company ranged from April 13, 2005 to September 29, 2006. In February 2005 we sold all of our available for-sale securities.



For the years ended June 30, 2005, 2004, and 2003, interest income was immaterial. Interest income is recorded as a
component of other income (expense).



Property and
Equipment



Property and equipment are stated at cost.
All furniture, fixtures, and equipment are depreciated using the straight-line method over the estimated useful lives of the respective assets, which is generally five years. Our payload processing facilities are depreciated using the straight-line
method over their estimated useful lives ranging from sixteen to forty-three years.



We have estimated the useful lives of our space flight assets, which is a component of property and equipment, through June 30, 2016, based on current available space-related programs and activities which
management expects will extend through 2016. The shuttle retirement could occur at an earlier date, which would accelerate the depreciation recognized upon revision of the estimated useful life.



Leasehold improvements are amortized over the shorter of the useful life of
the building or the term of the lease. Repairs and maintenance are expensed when incurred.



Investments in Affiliates



We use the equity method of accounting for our investments in, and earnings of, investees in which we exert significant influence. In accordance with the equity method of accounting, the carrying amount of such an
investment is initially recorded at cost and is increased to reflect our share of the investors income and is reduced to reflect the Companys share of the investors losses. Investments in which the Company has less than 20%
ownership and no significant influence are accounted for under the cost method and are carried at cost (see note 17).



Impairment of Long- Lived Assets



We account for long-lived assets in accordance with the provisions SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived
Assets. This Statement requires long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability
of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by
the amount by which the carrying amount of the assets exceeds the fair value of the assets (see note 20). Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.



9



---



|            |  |      |  |                                                                                                                                                                                                                                                                                                                                                                                 
|----------- |  | ---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  |      |  | Description of Exhibit                                                                                                                                                                                                                                                                                                                                                          
|            |  |     
|(2)         |  |      |  | Articles of Incorporation and Bylaws                                                                                                                                                                                                                                                                                                                                            
|            |  |     
|            |  | 2.1  |  | Amended and Restated Articles of Incorporation of the Registrant, as amended (incorporated by reference to Exhibit 4.1 of the Registrants Registration Statement (Reg. No. 333-126772),
and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                      
|            |  |     
|            |  | 2.2  |  | Bylaws of the Registrant (incorporated by reference to the Registrants registration statement on Form S-1, File No. 33- 97812, and all amendments thereto, filed with the Securities
and Exchange Commission on October 5, 1995)**                                                                                                                                             
|            |  |     
|(4)         |  |      |  | Instruments Defining the Rights of Security Holders, including Indentures                                                                                                                                                                                                                                                                                                       
|            |  |     
|            |  | 4.1  |  | Designation of Rights, Terms and Preferences of Series B Senior Convertible Preferred Stock of the Registrant (incorporated by reference to Exhibit 4.3 of the Registrants Registration
Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                     
|            |  |     
|            |  | 4.2  |  | Preferred Stock Purchase Agreement between the Registrant and DaimlerChrysler Aerospace AG dated as of August 2, 1999 (incorporated by reference to Exhibit 4.2 of the Registrants Report
on Form 8-K filed with the Securities and Exchange Commission on August 19, 1999)**                                                                                                  
|            |  |     
|            |  | 4.3  |  | Registration Rights Agreement between the Registrant and DaimlerChrysler Aerospace AG dated as of August 5, 1999 (incorporated by reference to Exhibit 4.3 of the Registrants Report on
Form 8-K filed with the Securities and Exchange Commission on August 19, 1999)**                                                                                                       
|            |  |     
|            |  | 4.4  |  | Indenture dated as of October 15, 1997 between the Registrant and First Union National Bank, as Trustee, relating to the Registrants 8% Convertible Subordinated Notes due 2007
(incorporated by reference to Exhibit 4.1 of the Registrants Registration Statement on Form S-3 (Reg. No. 333-43221) filed with the Securities and Exchange Commission on December 24, 1997)**
|            |  |     
|(10)        |  |      |  | Material Contracts                                                                                                                                                                                                                                                                                                                                                              
|            |  |     
|            |  | 10.1 |  | Amended and Restated Representation Agreement, dated August 15, 1995, by and between the Registrant and Mitsubishi Corporation (incorporated by reference to Exhibit 10.1 of the
Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                   
|            |  |     
|            |  | 10.2 |  | Amended and Restated Representation AgreementRevision I, dated January 13, 2004, by and between the Registrant and Mitsubishi Corporation (incorporated by reference to Exhibit 10.2 of
the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                       
|            |  |     
|            |  | 10.3 |  | Letter Agreement dated August 15, 1995, by and between the Registrant and Mitsubishi Corporation (incorporated by reference to Exhibit 10.7 of the Registrants Registration Statement on
Form S-1 (Reg. No. 33-97812) filed with the Securities and Exchange Commission on October 5, 1995)**                                                                                  
|            |  |     
|            |  | 10.4 |  | SPACEHAB, Incorporated 1995 Directors Stock Option Plan as amended and restated effective October 21, 1997 (incorporated by reference to Exhibit B of the Registrants Definitive
Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on September 12, 1997)**                                                                                   
|            |  |     
|            |  | 10.5 |  | Office Building Lease Agreement, dated October 6, 1993, between Astrotech and the Secretary of the Air Force (Lease number SPCVAN  2-94-001) (incorporated by reference to Exhibit 10.52
of the Registrants Annual Report on Form 10-K for the fiscal year ended June 30, 1997 filed with the Securities and Exchange Commission on September 12, 1997)**                     
|            |  |     
|            |  | 10.6 |  | SPACEHAB, Incorporated 1994 Stock Incentive Plan as amended and restated effective October 14, 1999 (incorporated by reference to Exhibit 10.90 of the Registrants Annual Report on Form
10-K for the fiscal year ended June 30, 1999 filed with the Securities and Exchange Commission on September 17, 1999)**                                                               



10



---

| |  |       |  |                                                                                                                                                                                                                                                                                                                                                                                      
| |  | ----- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |      
| |  | 10.7  |  | Agreement, dated September 30, 2004, between the Registrant and Dr. Shelley A. Harrison (incorporated by reference to Exhibit 10.7 of the Registrants Registration Statement (Reg.
No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                               
| |  |      
| |  | 10.8  |  | Lease for property at 300 D Street, SW, Suite #814, Washington, DC, dated as of December 16, 1998, by and between the Registrant and The Washington Design Center, LLC (incorporated by
reference to Exhibit 10.8 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**
| |  |      
| |  | 10.9  |  | Sublease Agreement, dated as of July, 2002, between the Registrant and The Boeing Company (incorporated by reference to Exhibit 10.9 of the Registrants Registration Statement (Reg. No.
333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                             
| |  |      
| |  | 10.10 |  | SPACEHAB, Incorporated 1997 Employee Stock Purchase Plan (incorporated by reference to Exhibit C of the Registrants Definitive Proxy Statement on Schedule 14A filed with the Securities
and Exchange Commission on September 12, 1997)**                                                                                                                                           
| |  |      
| |  | 10.11 |  | Agreement between Astrotech Space Operations, Inc. and McDonnell Douglas Corporation, dated January 7, 2000 (incorporated by reference to Exhibit 10.103 of the Registrants Quarterly
Report on Form 10-Q for the quarter ended March 31, 2000 filed with the Securities and Exchange Commission on May 12, 2000)**                                                                 
| |  |      
| |  | 10.12 |  | Agreement between Astrotech Space Operations, Inc. and Lockheed Martin Commercial Launch Services, Inc., dated January 24, 2000 (incorporated by reference to Exhibit 10.104 of the
Registrants Quarterly Report on Form 10-Q for the quarter ended March 31, 2000 filed with the Securities and Exchange Commission on May 12, 2000)**                                             
| |  |      
| |  | 10.13 |  | Credit agreement dated as of August 30, 2001 by and between Astrotech Florida Holdings, Inc. and SouthTrust Bank (incorporated by reference to Exhibit 10.114 of the Registrants
Quarterly Report on Form 10-Q for the quarter ended September 30, 2001 filed with the Securities and Exchange Commission on November 8, 2001)**                                                    
| |  |      
| |  | 10.14 |  | Employment and Non-Interference Agreement, dated as of April 1, 2003, between the Registrant and Michael E. Kearney (incorporated by reference to Exhibit 10.119 of the Registrants
Quarterly Report on Form 10-Q for the quarter ended March 31, 2003 filed with the Securities and Exchange Commission on May 14, 2003)**                                                         
| |  |      
| |  | 10.15 |  | First amendment to the Credit Agreement dated as of August 30, 2001 by and between Astrotech Florida Holdings, Inc. and SouthTrust Bank (incorporated by reference to Exhibit 10.122 of the
Registrants Quarterly Report on Form 10-Q for the quarter ended December 31, 2003 filed with the Securities and Exchange Commission on February 13, 2004)**                             
| |  |      
| |  | 10.16 |  | Employment and Non-Interference Agreement, dated as of January 9, 2004, between the Registrant and Brian K. Harrington (incorporated by reference to Exhibit 10.123 of the Registrants
Quarterly Report on Form 10-Q for the quarter ended March 31, 2004 filed with the Securities and Exchange Commission on May 12, 2004)**                                                      
| |  |      
| |  | 10.17 |  | 50 Year Lease, dated as of February 1, 1991, between the Registrant and Canaveral Port Authority (incorporated by reference to Exhibit 10.17 of the Registrants Registration Statement
(Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                     
| |  |      
| |  | 10.18 |  | Commercial Contract, dated as of March 3, 2005, between the Registrant and Tamir Silvers, LLC (incorporated by reference to Exhibit 10.18 of the Registrants Registration Statement (Reg.
No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                        
| |  |      
| |  | 10.19 |  | Lease Agreement, dated as of February 18, 2005, between the Registrant and R & H Investments, a California partnership (incorporated by reference to Exhibit 10.19 of the Registrants
Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                               



11



---

| |  |       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |  | ----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |      
| |  | 10.20 |  | Fixed Price Subcontract 889208 for Wideband Gapfiller Satellite Program Launch Site Payload Processing Facilities and Services, dated as of January 18, 2005, between Boeing Satellite
Systems, Inc. and Astrotech Space Operations, Inc. (incorporated by reference to Exhibit 10.20 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on
July 21, 2005)**
| |  |      
| |  | 10.21 |  | Purchase Order 3H03105, dated as of July 14, 2003, between the Registrant and The Boeing Company (incorporated by reference to Exhibit 10.21 of the Registrants Registration Statement
(Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                         
| |  |      
| |  | 10.22 |  | Loan Agreement, dated as of February 11, 2005, between the Registrant and First American Bank, SSB (incorporated by reference to Exhibit 10.125 to the Registrants Quarterly Report on
Form 10-Q for the quarter ended December 31, 2004 filed with the Securities and Exchange Commission on February 14, 2005)**                                                                                                                                      
| |  |      
| |  | 10.23 |  | Letter Contract No. GF80726B11, dated as of February 18, 2004, between the Registrant and Lockheed Martin Corporation (incorporated by reference to Exhibit 10.23 of the Registrants
Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                    
| |  |      
| |  | 10.24 |  | ISS Program Integration and Control Contract, between SPACEHAB Government Services, Inc. and ARES Corporation (incorporated by reference to Exhibit 10.24 of the Registrants Registration
Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                            
| |  |      
| |  | 10.25 |  | Contract No. SHI-SFS-03001 for Thermal Conditioning Service for Granada Crystallization Facilities, dated as of December 18, 2003, between the Registrant and V.J.F. Russian Consulting, Ltd.
(incorporated by reference to Exhibit 10.25 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                            
| |  |      
| |  | 10.26 |  | Consulting Agreement No. 2004-006- SHI-SFS, dated as of June 1, 2004, between the Registrant and V.J.F. Russian Consulting, Ltd. (incorporated by reference to Exhibit 10.26 of the
Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                         
| |  |      
| |  | 10.27 |  | Asset Purchase Agreement, dated as of December 19, 2000, between the Registrant and Astrium GmbH. (incorporated by reference to Exhibit 10.27 of the Registrants Registration Statement
(Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                        
| |  |      
| |  | 10.28 |  | Amendment No. 1 to Asset Purchase Agreement, dated as of December 19, 2000, between the Registrant and Astrium GmbH, dated July 3, 2001 (incorporated by reference to Exhibit 10.28 of the
Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                  
| |  |      
| |  | 10.29 |  | Lease Agreement, dated as of February 28, 2001, between the Registrant and Astrium GmbH (incorporated by reference to Exhibit 10.29 of the Registrants Registration Statement (Reg. No.
333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                  
| |  |      
| |  | 10.30 |  | Binding Term Sheet, dated as of December 19, 2001, between the Registrant and Astrium GmbH, amending the Lease Agreement, dated as of February 28, 2001, between the Registrant and Astrium
GmbH (incorporated by reference to Exhibit 10.30 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                         
| |  |      
| |  | 10.31 |  | Lease Agreement, dated as of July 3, 2001, between the Registrant and Astrium GmbH (incorporated by reference to Exhibit 10.31 of the Registrants Registration Statement (Reg. No.
333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                       



12



---

| |  |       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |  | ----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |      
| |  | 10.32 |  | Agreement No. 48801 for Provision of Payload Processing Facilities and Support in Conjunction with Commercial Atlas Launches, between Astrotech Space Operations, Inc. and Lockheed Martin
Commercial Launch Services, Inc. (incorporated by reference to Exhibit 10.32 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21,
2005)**                                      
| |  |      
| |  | 10.33 |  | Contract No. NNK04LA75C, dated as of July 2, 2004, between Astrotech Space Operations, Inc. and John F. Kennedy Space Center, NASA (incorporated by reference to Exhibit 10.33 of the
Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                               
| |  |      
| |  | 10.34 |  | Agreement and Statement of Work, dated as of April 25, 1996 and as amended by Amendment No. 3 as of December 6, 2002, between Astrotech Space Operations, Inc. and Sea Launch Company, L.L.C.
(incorporated by reference to Exhibit 10.34 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                    
| |  |      
| |  | 10.35 |  | Employment and Non-Interference Agreement, dated as of May 12, 2005, between the Registrant and Michael E. Bain (incorporated by reference to Exhibit 10.35 of the Registrants
Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                  
| |  |      
| |  | 10.36 |  | Employment and Non-Interference Agreement, dated as of May 12, 2005, between the Registrant and E. Michael Chewning (incorporated by reference to Exhibit 10.36 of the Registrants
Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                              
| |  |      
| |  | 10.37 |  | Settlement Agreement and Mutual Release of All Claims, dated as of May 25, 2005, among the Registrant and Lloyds of London, Goshawk Syndicate No. 102, Euclidian Syndicate No. 1243,
Ascot Underwriting Ltd. Syndicate No. 1414, and R.J. Kiln Syndicate No. 510 (incorporated by reference to Exhibit 10.37 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and
Exchange Commission on July 21, 2005)**
| |  |      
| |  | 10.38 |  | Sublease Agreement, dated as of May 14, 2004, between the Registrant and Paragon Personnel, Inc. (incorporated by reference to Exhibit 10.38 of the Registrants Registration Statement
(Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                                 
| |  |      
| |  | 10.39 |  | Lease No. SPCVAN-2-94-0001, between the Secretary of the Airforce and Astrotech Space Operations, L.P. (incorporated by reference to Exhibit 10.39 of the Registrants Registration
Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                           
| |  |      
| |  | 10.40 |  | Strategic Collaboration Agreement, dated as of August 5, 1999, between the Registrant and DaimlerChrysler Aerospace AG (incorporated by reference to Exhibit 10.40 of the Registrants
Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                           
| |  |      
| |  | 10.41 |  | Guaranty Agreement, dated as of August 30, 2001, between the Registrant and Southtrust Bank (incorporated by reference to Exhibit 10.41 of the Registrants Registration Statement (Reg.
No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                                      
| |  |      
| |  | 10.42 |  | Guaranty Agreement, dated as of August 30, 2001, between Astrotech Space Operations, Inc. and Southtrust Bank (incorporated by reference to Exhibit 10.42 of the Registrants Registration
Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                    
| |  |      
| |  | 10.43 |  | Stock Pledge and Security Agreement, dated as of August 30, 2001, between the Registrant and Southtrust Bank (incorporated by reference to Exhibit 10.43 of the Registrants Registration
Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                                                                                                                                     



13



---

|     |  |       |  |                                                                                                                                                                                                                                                                                                                                               
|---- |  | ----- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |  |      
|     |  | 10.44 |  | Stock Pledge and Security Agreement, dated as of August 30, 2001, between Astrotech Space Operations, Inc. and Southtrust Bank (incorporated by reference to Exhibit 10.44 of the
Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**
|     |  |      
|     |  | 10.45 |  | Assignment of CLIN 1 Rights, dated as of August 30, 2001, between Astrotech Space Operations, Inc. and Southtrust Bank (incorporated by reference to Exhibit 10.45 of the Registrants
Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**        
|     |  |      
|     |  | 10.46 |  | Termination Agreement, dated as of June 1, 2004, between the Registrant and Vladimir J. Fishel (incorporated by reference to Exhibit 10.46 of the Registrants Registration Statement
(Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                                
|     |  |      
|     |  | 10.47 |  | Memorandum of Understanding, dated as of June 8, 2005, between the Registrant and SMH Capital Advisors, Inc. (incorporated by reference to Exhibit 10.47 of the Registrants Registration
Statement (Reg. No. 333-126772), and all amendments thereto, filed with the Securities and Exchange Commission on July 21, 2005)**                  
|     |  |      
|     |  | 10.48 |  | Space Media, Inc. Stock Option Plan (incorporated by reference to Exhibit 10.48 of the Registrants Registration Statement (Reg. No. 333-126772), and all amendments thereto, filed with
the Securities and Exchange Commission on July 21, 2005)**                                                                                           
|     |  |      
|(16) |  |       |  | Letter Regarding Change in Certifying Accountant                                                                                                                                                                                                                                                                                              
|     |  |      
|     |  | 16.1  |  | Letter from Ernst & Young LLP regarding change in certifying accountant, dated May 18, 2004 (incorporated by reference to Exhibit 16 of the Registrants Current Report on Form 8-K
filed with the Securities and Exchange Commission on May 18, 2004)**                                                                                      
|     |  |      
|(21) |  |       |  | SPACEHAB, Incorporated and Subsidiaries  Subsidiaries of the Registrant                                                                                                                                                                                                                                                                      
|     |  |      
|(23) |  |       |  | Consents of Experts and Counsel                                                                                                                                                                                                                                                                                                               
|     |  |      
|     |  | 23.1  |  | Consent of Grant Thornton LLP                                                                                                                                                                                                                                                                                                                 
|     |  |      
|     |  | 23.2  |  | Consent of Ernst & Young LLP                                                                                                                                                                                                                                                                                                                  
|     |  |      
|(31) |  |       |  | Rule 13a-14(a) Certifications                                                                                                                                                                                                                                                                                                                 
|     |  |      
|     |  | 31.1  |  | Certification of Michael E. Kearney, the Companys President and Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002, file herewith**                                                                                                                           
|     |  |      
|     |  | 31.2  |  | Certification of Brian K. Harrington, the Companys Senior Vice-President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, file herewith**                                                                                                              
|     |  |      
|(32) |  |       |  | Section 1350 Certifications                                                                                                                                                                                                                                                                                                                   
|     |  |      
|     |  | 32.1  |  | Certification of Michael E. Kearny, the Companys President and Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, file herewith**                                                                                                                            
|     |  |      
|     |  | 32.2  |  | Certification of Brian K. Harrington, the Companys Senior Vice-President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, file herewith**                                                                                                              
|     |  |      
|     |  | 99.1  |  | Schedule IIValuation and Qualifying Accounts, filed herewith**                                                                                                                                                                                                                                                                               



|** | Previously Filed
|-- | ----------------



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SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.



|                      |  |                        |  |                                      
|--------------------- |  | ---------------------- |  | -------------------------------------
|                      |  | SPACEHAB, Incorporated
|                      |  |                       
|Date: October 5, 2005 |  | By:                    |  | /s/ Michael E. Kearney               
|                      |  |                        |  | Michael E. Kearney                   
|                      |  |                        |  | President and Chief Executive Officer
|                      |  |                        |  | and Director                         
|                      |  |                       
|                      |  |                        |  |                                      
|                      |  |                       
|Date: October 5, 2005 |  | By:                    |  | /s/ Brian K. Harrington              
|                      |  |                        |  | Brian K. Harrington                  
|                      |  |                        |  | Senior Vice President and            
|                      |  |                        |  | Chief Financial Officer              



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