INVESTOR ALERT: Law Offices of Howard G. Smith Announces the Filing of a Securities Class Action on Behalf of Virgin Galactic Holdings, Inc. (SPCE) Investors

BENSALEM, Pa.--()--Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased Virgin Galactic Holdings, Inc. (“Virgin Galactic” or the “Company”) (NYSE: SPCE) securities between October 26, 2019 and April 30, 3021, inclusive (the “Class Period”). Virgin Galactic investors have until July 27, 2021 to file a lead plaintiff motion.

Investors suffering losses on their Virgin Galactic investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to howardsmith@howardsmithlaw.com.

On October 25, 2019, post-market, Virgin Galactic was formed by a business combination between Social Capital Hedosophia Holdings Corp. ("SCH"), a special purpose acquisition company ("SPAC"), and the Company's then-private predecessor, after which SCH changed its name to "Virgin Galactic Holdings, Inc." and its ticker symbol to "SPCE" (the "Business Combination").

On April 12, 2021, the U.S. Securities and Exchange Commission (“SEC”) issued guidance advising that SPAC warrants, which are instruments that allow investors to buy additional shares at a fixed price, may need to be classified as liabilities rather than equity for many SPAC transactions, which had previously been accounted for as equity in these deals.

On April 30, 3021, post-market, Virgin Galactic announced in a press release "that it has rescheduled the reporting of its financial results for the first quarter 2021 to following the close of the U.S. markets on Monday, May 10, 2021. Virgin Galactic will now host a conference call to discuss the results and provide a business update that day at 2:00 p.m., Pacific Time (5:00 p.m., Eastern Time). The Company is rescheduling its reporting due to the recent statement issued by the [SEC] on April 12, 2021 relating to the accounting treatment of warrants issued by special purpose acquisition companies (the 'SEC Statement')." The company further advised that "following its review of the SEC Statement and consulting with its advisors, the Company will restate its consolidated financial statements included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2020. The restatement is due solely to the accounting treatment for the warrants of Social Capital Hedosophia Holdings Corp. that were outstanding at the time of the Company's business combination on October 25, 2019. The Company expects to file the restated financials prior to the new conference call date and estimates that it will recognize incremental non-operating, non-cash expense for each of the fiscal years ended December 31, 2020 and December 31, 2019."

On this news, Virgin Galactic's stock price fell $2.01 per share, or 9.07%, to close at $20.14 per share on May 3, 2021.

The complaint filed alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) for accounting purposes, SCH's warrants were required to be treated as liabilities rather than equities; (2) Virgin Galactic had deficient disclosure controls and procedures and internal control over financial reporting; (3) as a result, the Company improperly accounted for SCH warrants that were outstanding at the time of the Business Combination; and (4) as a result, Defendants' statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.

If you purchased Virgin Galactic securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847, toll-free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com, or visit our website at www.howardsmithlaw.com.

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.

Contacts

Law Offices of Howard G. Smith
Howard G. Smith, Esquire
215-638-4847
888-638-4847
howardsmith@howardsmithlaw.com
www.howardsmithlaw.com

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Contacts

Law Offices of Howard G. Smith
Howard G. Smith, Esquire
215-638-4847
888-638-4847
howardsmith@howardsmithlaw.com
www.howardsmithlaw.com