Vienna, VA, December 11, 1998 — SPACEHAB, Inc. (Nasdaq: SPAB), the leading commercial space services provider for manned and unmanned payloads, announced today it has reached agreement with the German Aerospace Center, DLR, to provide space-based research services aboard a September 2000 Space Shuttle flight.

Under the $1.1 million agreement, DLR (or Deutsches Zentrum fuer Luft- und Raumfahrt, in German) will purchase one locker aboard the SPACEHAB Double Research Module on Space Shuttle Mission STS-107. Housed in the pressurized, or habitable, SPACEHAB module, the microwave oven-sized locker will be filled with science experiments. SPACEHAB also will provide experiment integration and operations services for the DLR payload.

The direct contract with DLR marks the first time the German government has been an independent customer to SPACEHAB, Inc. Previous Shuttle-based research services involving German researchers have been arranged through NASA or the European Space Agency.

SPACEHAB, Inc., with its Johnson Engineering and Astrotech subsidiaries, is the world's leading provider of commercial payload processing services for manned and unmanned payloads. SPACEHAB is the first company to commercially develop, own and operate habitable modules that provide laboratory facilities and logistics re-supply aboard NASA’s Space Shuttles. The Company also supports NASA astronaut training at Johnson Space Center, Houston.

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