UNITED STATES OF AMERICA
                                      Before the
                          SECURITIES AND EXCHANGE COMMISSION

          SECURITIES ACT OF 1933
          Release No.   7667 \ April 13, 1999

          SECURITIES EXCHANGE ACT OF 1934
          Release No. 41279 \ April 13, 1999

          ADMINISTRATIVE PROCEEDING
          File No. 3-9668
                                        :  
                                        :
                                        :         ORDER MAKING FINDINGS
          In the Matter of              :         AND IMPOSING A CEASE-AND-
          SpaceDev, Inc. and            :         DESIST ORDER
          James William Benson,         :
                                        :
               Respondents.             :
                                        :


                                         I.

               On August 6, 1998 the Securities and Exchange Commission
          ("Commission") issued an Order Instituting Public Cease-and-
          Desist Proceedings ("Order Instituting") pursuant to Section 8A
          of the Securities Act of 1933 ("Securities Act") and Section 21C
          of the Securities Exchange Act of 1934 ("Exchange Act") against
          SpaceDev, Inc. ("SpaceDev") and James William Benson ("Mr.
          Benson").

               SpaceDev and Mr. Benson have each submitted an Offer of
          Settlement ("Offers"), which the Commission has determined to
          accept.  Solely for the purpose of these proceedings and any
          other proceedings brought by or on behalf of the Commission or in
          which the Commission is a party, and without admitting or denying
          the findings herein, except the jurisdiction of the Commission
          over them and over the matters set forth herein, which they
          admit, SpaceDev and Mr. Benson have consented to the entry of
          this Order Making Findings and Imposing a Cease-and-Desist Order
          ("Order").

                                         II.

               On the basis of this Order and the Offers submitted by
          SpaceDev and Mr. Benson, the Commission finds that:

               1.   SpaceDev is a Colorado corporation headquartered in San
          Diego, California.  SpaceDev is the surviving corporation of the
          October 1997 merger between a privately-held, Colorado-based
          holding company named SpaceDev, LLC, and a Colorado public shell
          company named Pegasus Development Group, Inc. ("Pegasus").  At
          all relevant times SpaceDev stock traded on the NASD Bulletin
          Board.

               2.   Mr. Benson, age 53, a resident of Virginia and
          California, has been chairman of SpaceDev’s board of directors
          since the company’s inception.

               3.   Section 17(a) of the Securities Act and Section 10(b)
          of the Exchange Act and Rule 10b-5 thereunder provide that it is
          unlawful for any person, directly or indirectly, in the offer or
          sale or in connection with the purchase or sale of securities by
          use of the means or instrumentalities of transportation or
          communication in interstate commerce or by use of the mails, to
          employ devices, schemes or artifices to defraud; obtain money or
          property by means of untrue statements of material facts or
          omissions to state material facts necessary in order to make the
          statements made, in the light of the circumstances under which
          they were made, not misleading; or engage in transactions,
          practices, or courses of business which would or did operate as a
          fraud or deceit upon the sellers and purchasers of securities.

               4.   From about January 1998 through June 1998, SpaceDev and
          Mr. Benson committed or caused violations of Section 17(a) of the
          Securities Act and Section 10(b) of the Exchange Act and Rule
          10b-5 thereunder.  As part of and in furtherance of such conduct
          and activities, SpaceDev and Mr. Benson made untrue statements of
          material facts and omitted to state material facts, or, through
          acts or omissions which Mr. Benson knew or should have known
          would contribute to violations by SpaceDev, Mr. Benson caused
          SpaceDev to make untrue statements of material facts and to omit
          material facts to the public, to investors and to prospective
          investors in press releases, a newsletter, and over the internet,
          concerning:

                    a.   the financial potential of SpaceDev, including
                         SpaceDev’s projected revenue and earnings;

                    b. the nature and status of SpaceDev’s agreements with
                    its underwriter.


                                        III.

               In view of the foregoing, the Commission finds that it is
          appropriate to impose the sanctions against SpaceDev and Mr.
          Benson as specified in their respective Offers.

               Accordingly, IT IS ORDERED that, pursuant to Section 8A of
          the Securities Act and Section 21C of the Exchange Act:

               A.   SpaceDev cease and desist from committing or causing
          violations or future violations of Section 17(a) of the
          Securities Act and Section 10(b) of the Exchange Act and Rule
          10b-5 thereunder; and

               A.   Mr. Benson cease and desist from committing or causing
          violations or future violations of Section 17(a) of the
          Securities Act and Section 10(b) of the Exchange Act and Rule
          10b-5 thereunder.

               By the Commission.



                                        Jonathan G. Katz
                                        Secretary