**EXHIBIT3.3**

 

**DESIGNATIONOF RIGHTS, TERMS AND PREFERENCES**

**OF**

**SERIES CCONVERTIBLE PREFERRED STOCK**

**OF**

**SPACEHAB,INCORPORATED**

 

(Pursuant toChapter 6 of the

WashingtonBusiness Corporation Act)

 

Spacehab, Incorporated (the “Corporation”), a corporation organizedand existing under the Business Corporation Act of the State of Washington (the“Business Corporation Act”), certifies that the following resolution wasadopted by the board of directors of the Corporation (the “Board ofDirectors”) as required by Chapter 6 of the Business Corporation Act at ameeting duly called and held on August 20, 2007:

 

RESOLVED, that pursuant to the authority granted to and vested in theBoard of Directors of this Corporation in accordance with the provisions of theArticles of Incorporation, the Board of Directors creates a series of PreferredStock of the Corporation, no par value per share (the “Preferred Stock”),and states the designation and number of shares, and fixes the relative rights,preferences, and limitations thereof, as follows:

 

Series C Convertible Preferred Stock:

 

# Section 1.       Designationand Amount.   The shares of suchseries shall be designated as “Series C Convertible Preferred Stock” (the “Series CPreferred Stock”).  The number ofshares of Series C Preferred Stock shall be one million (1,000,000).  The number of shares of Series CPreferred Stock may be decreased by resolution of the Board of Directors;provided, however, that no decrease shall reduce the number of shares of Series CPreferred Stock to a number less than the number of shares then outstanding.

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# Section 2.       Dividends.   The holders ofthe Series C Preferred Stock shall be entitled to receive, out of fundslegally available therefor, such dividends with respect to the shares of Series CPreferred Stock as may be declared by the Board of Directors.  In addition, when and if the Board ofDirectors shall declare a dividend payable with respect to the then outstandingshares of Common Stock, no par value per share (“Common Stock”) of theCorporation, each holder of Series C Preferred Stock shall be entitled tothe amount of dividends as would be payable on the largest number of wholeshares of Common Stock into which shares of Series C Preferred Stock heldby such holder could then be converted pursuant to Section 5 hereof (suchnumber to be determined as of the record date for the determination of holdersof Common Stock entitled to receive such dividend).  Dividends shall not be declared or paid toholders of Common Stock unless and until the Corporation shall simultaneouslydeclare and pay to holders of Series C Preferred Stock the dividendreferred to in the preceding sentence.

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# Section 3.       Liquidation,Dissolution or Winding Up; Certain Mergers, Consolidations and Asset Sales.

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## a.             Inthe event of any voluntary or involuntary liquidation, dissolution orwinding-up of the Corporation, the holders of then outstanding shares of Series CPreferred Stock shall be entitled to be paid out of the assets available fordistribution to the Corporation’s shareholders, and before any payment shall bemade to the holders of any class of common stock of the Corporation (the “CommonStock”) or any other class or series of stock ranking on liquidation juniorto the Series C Preferred Stock (the Common Stock and other classes orseries of stock ranking on liquidation junior to the Series C PreferredStock being collectively referred to as the “Junior Stock”), by reasonof their ownership thereof, an amount equal to $584.40 for each outstandingshare of Series C Preferred Stock (the “Series C Original IssuePrice”).  If on any such liquidation,dissolution, or winding-up of the Corporation, the Corporation’s remainingassets available for distribution to stockholders is insufficient to pay theholders of the Series C Preferred Stock in full, the holders of the Series CPreferred Stock shall share ratably in any distribution of the Corporation’sremaining assets and funds in proportion to the respective amounts that wouldotherwise be payable in connection with the shares held by them on suchdistribution if the full amounts payable on or in respect of such shares werepaid.

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## b.             Afterthe full payment of all preferential amounts required to be paid to the holdersof the Series C Preferred Stock on the liquidation, dissolution, orwinding-up of the Corporation, the holders of the Junior Stock then outstandingshall be entitled to receive the remaining assets and funds available fordistribution to the Corporation’s stockholders.

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## c.             Theconsolidation or merger of the Corporation into or with any other entity orentities resulting in the exchange of outstanding shares of the Corporation forsecurities or other consideration issued or paid (or caused to be issued orpaid) by any such entity or affiliate thereof, and the sale or transfer by theCorporation of all or substantially all its assets, shall be deemed to be aliquidation, dissolution or winding up of the Corporation within the meaning ofthe provisions of this Section 3, but only for the purposes of theredemption of such Series C Preferred Stock, and only if so elected by theholders of a majority of the outstanding shares of Series C PreferredStock, in their sole discretion.

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# Section 4.       Voting.

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## a.             Eachholder of outstanding shares of Series C Preferred Stock shall be entitledto the number of votes equal to the number of whole shares of Common Stock intowhich the shares of Series C Preferred Stock held by such holder are thenconvertible (as periodically adjusted pursuant to Section 5 hereof), ateach meeting of stockholders of the Corporation (and written actions ofstockholders in lieu of meetings) concerning any and all matters presented tothe stockholders of the Corporation for their action or consideration.  Except as required by law or by Section 4(b) below,holders of Series C Preferred Stock shall vote together with the holdersof Common Stock as a single class.

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## b.             Aslong as any shares of the Series C Preferred Stock remain outstanding,unless the vote or consent of the holders of a greater number of shares shallthen be required by law, the affirmative vote or consent of the holders of morethan 50% of all of the shares of Series C Preferred Stock at the timeoutstanding, voting separately as a class, given in person or by proxy eitherin writing (as may be permitted by law and the Articles of Incorporation andBy-laws of the Corporation) or at any special or annual meeting, shall benecessary to permit, effect, or validate the taking of any of the followingactions by the Corporation:

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### (i)            create, authorize, issue or sell (a) anyclass or series of capital stock ranking senior to or on parity with the Series CPreferred Stock as to dividends or on liquidation, dissolution or winding up;provided, however, that holders of Common Stock may receive dividends to theextent provided by Section 2 above and, provided further, that the consentto issuance of any class or series of capital stock ranking on parity with the Series CPreferred Stock shall not be unreasonably withheld, or (b) any rights,options or other securities convertible, exercisable or exchangeable for orinto, or having rights to purchase, any shares of capital stock described inclause (a) hereof;

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### (ii)           amend the Articles of Incorporationor By-laws of the Corporation, or in any other manner alter or change the relativepowers, rights, privileges or preferences of the Series C Preferred Stock,but only to the extent such amendment or action would alter, change or affectadversely the relative powers, rights, privileges or preferences of the holdersof the Series C Preferred Stock;

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### (iii)          increase the number of shares of Series CPreferred Stock authorized for issuance above 1,000,000 shares; or

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### (iv)          at any time after the initial issuancedate of the Series C Preferred Stock, issue any shares of Series CPreferred Stock, except (i) issuances of share certificates upontransfers or exchanges of shares by holders (other than the Corporation) or inreplacement of lost, stolen, damaged or mutilated share certificates; or (ii) issuancespursuant to or permitted by the Restructuring and Exchange Agreement.

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# Section 5.       ConversionRights.   The holders of the Series CPreferred Stock shall each have the following conversion rights (collectively,the “Conversion Rights”):

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## a.             MandatoryConversion.  Each share of Series CPreferred Stock shall automatically be converted, immediately on theeffectiveness of an amendment to the Corporation’s Articles of Incorporationincreasing the number of authorized shares of Common Stock to at least 200million shares (such date being the “Conversion Date”), into such numberof fully paid and nonassessable shares of Common Stock as is determined bydividing the aggregate Series C Original Issue Price of the Shares of Series CPreferred Stock being converted by the Series C Conversion Price in effectat the time of conversion or such share. The initial “Series C Conversion Price” shall be $.40, 

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## subject to adjustment as provided below. For purposes of this Section 5,“Original Issue Date” shall mean, for the Series C Preferred Stock, thedate on which the first share of Series C Preferred Stock was issued.

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## b.             FractionalShares.  No fractional shares ofCommon Stock shall be issued on conversion of the Series C PreferredStock.  The number of shares of CommonStock to be issued shall be rounded to the nearest whole share.  The shares issuable on the conversion shallbe determined on the basis of the total number of shares of Series CPreferred Stock that the holder is then converting into Common Stock and thenumber of shares of Common Stock issuable on such aggregate conversion.

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## c.             Mechanicsof Conversion.

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#### (i)            Notmore than 15 days after the Conversion Date, the Corporation shall send anotice containing a letter of transmittal (which shall specify that thedelivery shall be effected, and risk of loss and title with respect to thestock certificates shall pass, only upon proper delivery of the stockcertificates to the transfer agent) and instructions for use in effecting thesurrender of the Shares of Series C Preferred Stock.  If required by the Corporation, certificatessurrendered for conversion shall be endorsed or accompanied by a writteninstrument or instruments of transfer, in form satisfactory to the Corporation(in its sole discretion), duly executed by the registered holder or his/her/itsattorney duly authorized in writing.  TheCorporation shall cause its transfer agent, as soon as practicable after the transferagent’s receipt of properly surrendered Shares of Series C Preferred Stock,issue and deliver at such office to such holder of Series C PreferredStock, or to his/her/its nominee(s), a certificate or certificates for thenumber of shares of Common Stock such holder is entitled to.  The number of shares of Common Stock to beissued shall be rounded to the nearest whole share.

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#### (ii)           Uponany such conversion, no adjustment to the Series C Conversion Price shallbe made for any declared or accrued but unpaid dividends on the Series CPreferred Stock surrendered for conversion or on the Common Stock deliveredupon conversion, but, as provided in clause (iii) below, such dividendsshall remain payable to the holder thereof.

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#### (iii)          Onthe Conversion Date, all shares of Series C Preferred Stock will no longerbe deemed to be outstanding, and all rights with respect to such shares(including the rights, if any, to receive notices and to vote) shallimmediately cease and terminate on the Conversion Date; provided, however, thatthe right of the holders thereof to receive shares of Common Stock in exchangetherefor and payment of any dividends declared or accrued and unpaid thereon onthe Conversion Date shall not cease and terminate on the Conversion Date.  Any shares of Series C Preferred Stockso converted shall be retired and cancelled and shall not be reissued, and theCorporation (without the need for stockholder action) may from time to timetake such appropriate action necessary to reduce the authorized Series C PreferredStock accordingly.

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#### (iv)          TheCorporation shall pay any and all issue and other taxes that may be payable inrespect of any issuance or delivery of shares of Common Stock on conversion ofshares of Series C Preferred Stock pursuant to this Section 5.  The Corporation shall not, however, berequired to pay any tax that may be payable in respect of any transfer involvedin the issuance and delivery of shares of Common Stock in a name other thanthat in which the shares of Series C Preferred Stock so converted wereregistered, and no such issuance or delivery shall be made unless and until theperson or entity requesting such issuance has paid to the Corporation theamount of any such tax or has established, to the satisfaction of theCorporation, that such tax has been paid.

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## d.             Adjustmentfor Stock Splits and Combinations. If the Corporation shall at any time (or from time to time) after theOriginal Issue Date of the Series C Preferred Stock effect a subdivisionof the outstanding Common Stock, the Series C Conversion Price then ineffect with respect to the Series C Preferred Stock immediately beforethat subdivision shall be proportionately decreased.  If the Corporation shall at any time (or fromtime to time) after the Original Issue Date of the Series C PreferredStock combine the outstanding shares of Common Stock, the Series CConversion Price then in effect immediately before the combination with respectto the Series C Preferred Stock shall be proportionately increased.  Any adjustment under this paragraph shallbecome effective at the close of business on the date the subdivision orcombination becomes effective.

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## e.             Adjustmentfor Certain Dividends and Distributions. In the event the Corporation at any time, or from time to time after theOriginal Issue Date of the Series C Preferred Stock shall make or issue,or fix a record date for the determination of holders of Common Stock entitledto receive, a dividend or other distribution payable in additional shares ofCommon Stock, then and in each such event the Series C Conversion Pricewith respect to the Series C Preferred Stock then in effect shall bedecreased as of the time of such issuance or, in the event such a record dateshall have been fixed, as of the close of business on such record date, bymultiplying the Series C Conversion Price for the Series C PreferredStock then in effect by a fraction:

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##### (1)           the numerator of which shall be thetotal number of shares of Common Stock issued and outstanding immediatelybefore the time of such issuance or the close of business on such record dateand

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##### (2)           the denominator of which shall be thetotal number of shares of Common Stock issued and outstanding immediatelybefore the time of such issuance or the close of business on such record dateplus the number of shares of Common Stock issuable in payment of such dividendor distribution;

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provided,however, that if such record date shall have been fixed and such dividend isnot fully paid or if such distribution is not fully made on the date fixedtherefor, the Series C Conversion Price for the Series C PreferredStock shall be recomputed accordingly as of the close of business on suchrecord date and thereafter the Series C Conversion Price for the Series CPreferred Stock shall be adjusted pursuant to this paragraph as of the time ofactual payment of such dividends or distributions.

 

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## f.              Adjustmentsfor Other Dividends and Distributions. In the event the Corporation at any time or from time to time after theOriginal Issue Date of the Series C Preferred Stock shall make or issue,or fix a record date for the determination of holders of Common Stock entitledto receive, a dividend or other distribution payable in securities of theCorporation other than shares of Common Stock, then and in each such eventprovision shall be made so that the holders of Series C Preferred Stockshall receive on conversion thereof in addition to the number of shares of CommonStock receivable thereupon, the amount of securities of the Corporation thatthey would have received had the Series C Preferred Stock been convertedinto Common Stock on the date of (and immediately prior to) such event and hadthereafter, during the period from the date of such event to and including theconversion date, retained such securities receivable by them as aforesaidduring such period, giving application to all adjustments called for duringsuch period under this paragraph with respect to the rights of the holders ofthe Series C Preferred Stock.

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## g.             Adjustmentfor Reclassification, Exchange or Substitution.  If the Common Stock issuable on theconversion of the Series C Preferred Stock is changed into the same or adifferent number of shares of any class or classes of stock, whether by capitalreorganization, reclassification, or otherwise (other than a subdivision orcombination of shares or stock dividend provided for above, or areorganization, merger, consolidation, or sale of assets provided for below),then and in each such event the holders of the Series C Preferred Stockshall have the right thereafter to convert such share into the kind and amountof shares of stock and other securities and property receivable on suchreorganization, reclassification, or other change, by holders of the number ofshares of Common Stock into which such shares of Series C Preferred Stockmight have been converted immediately before such reorganization,reclassification, or change, all subject to further adjustment as providedherein.

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## h.             Adjustmentfor Merger or Reorganization, etc. In case of any consolidation or merger of the Corporation with or intoanother corporation or the sale of all or substantially all of the assets ofthe Corporation to another corporation (other than a consolidation, merger orsale covered by Section 3(b) above), each share of Series CPreferred Stock shall thereafter be convertible (or shall be converted into asecurity that is convertible) into the kind and amount of shares of stock orother securities or property to which a holder of the number of shares ofCommon Stock deliverable on conversion of such Series C Preferred Stockwould have been entitled to on such consolidation, merger or sale; and, in suchcase, appropriate adjustment (as determined in good faith by the Board ofDirectors) shall be made in the application of the provisions in this Section 5set forth with respect to the rights and interest thereafter of the holders ofthe Series C Preferred Stock, to the end that the provisions set forth inthis Section 5 (including provisions with respect to changes in and otheradjustments of the Series C Conversion Price) shall thereafter beapplicable, as nearly as reasonably may be, in relation to any shares of stockor other property thereafter deliverable on the conversion of the Series CPreferred Stock.

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## i.              NoImpairment.  The Corporation willnot, by amendment of its Articles of Incorporation, or through anyreorganization, transfer of assets, consolidation, 

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## merger, dissolution, issue or sale of securities or any other voluntaryaction, avoid or seek to avoid the observance or performance of any of theterms to be observed or performed hereunder by the Corporation, but will at alltimes in good faith assist in the carrying out of all the provisions of this Section 5and in the taking of all such action as may be necessary or appropriate inorder to protect the respective Conversion Rights of the holders of the Series CPreferred Stock against impairment.

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## j.              Certificateas to Adjustments.  On the occurrenceof each adjustment or readjustment of the Series C Conversion Pricepursuant to this Section 5, the Corporation (at its expense) shallpromptly compute such adjustment or readjustment in accordance with the termshereof and furnish to each holder of Series C Preferred Stock acertificate setting forth such adjustment or readjustment and showing in detailthe facts on which such adjustment or readjustment is based.  On the written request at any time of anyholder of Series C Preferred Stock, the Corporation shall furnish or causeto be furnished to such holder a similar certificate setting forth (i) suchadjustments and readjustments, (ii) the Series C Conversion Pricethen in effect, and (iii) the number of shares of Common Stock and theamount, if any, of other property that then would be received on the conversionof such Series C Preferred Stock.

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## k.             Noticeof Record Date.  In the event:

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#### (i)            that the Corporation declares adividend (or any other distribution) on its Common Stock payable in CommonStock or other securities of the corporation;

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#### (ii)           that the Corporation subdivides orcombines its outstanding shares of Common Stock;

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#### (iii)          of any reclassification of the CommonStock of the Corporation (other than a subdivision or combination of itsoutstanding shares of Common Stock or a stock dividend or stock distributionthereon), or of any consolidation or merger of the Corporation into or withanother corporation, or of the sale of all or substantially all of the assetsof the Corporation; or

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#### (iv)          of the involuntary or voluntarydissolution, liquidation, or winding-up of the Corporation;

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thenthe Corporation shall cause to be filed at its principal office, and shallcause to be mailed to the holders of the Series C Preferred Stock at theirlast addresses as shown on the records of the Corporation or its transferagent, at least ten days before the date specified in (A) below or 20 daysbefore the date specified in (B) below, a notice stating

 

(i)                                     the record date of such dividend,distribution, subdivision or combination, or, if a record is not to be taken,the date as of which the holders of Common Stock of record to be entitled tosuch dividend, distribution, subdivision or combination are to be determined,or

 

 

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(ii)                                  the date such reclassification,consolidation, merger, sale, dissolution, liquidation or winding-up is expectedto become effective, and the date that it is expected that holders of CommonStock of record shall be entitled to exchange their shares of Common Stock forsecurities or other property deliverable on such reclassification,consolidation, merger, sale, dissolution or winding-up.

 

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IN WITNESS WHEREOF, this Designation of Rights, Termsand Preferences is executed on behalf of the Corporation by its Secretary, andattested by its Assistant Secretary on September 19, 2007.

 
|   | SPACEHAB,  INCORPORATED |
|--------|-------------------------|
|   |                    |
|   |                    |
|   | By:                     | /s/Brian K.  Harrington |   |
|   | Name:                   | Brian K.  Harrington |
|   | Title:                  | Secretary |

 

 
| Attest: | /s/Bryan Leger      |   |
|---------|---------------------|--------|
| Name:   | Bryan Leger         |   |
| Title:  | Assistant Secretary |   |