Virgin Galactic Holdings Inc. (NYSE: SPCE) issued a notice to redeem up to $30.5 million of its 9.80% First Lien Notes due 2028 using shares of common stock rather than cash, according to a company statement.

The space tourism company will redeem the notes on June 10, 2026, at par value plus accrued interest. The redemption will be executed by issuing shares to noteholders based on the volume-weighted average price of the company's stock over a five-day observation period.

Virgin Galactic was required to redeem $30.4 million in principal by September 30, 2026, under its debt agreement. The company previously redeemed $10 million in May 2026, leaving $20.4 million remaining. An additional $10.1 million was required to be redeemed by December 31, 2027.

If the stock price falls below a specified floor price during the observation period, the company may elect not to redeem the corresponding portion of the notes. The total redemption amount could therefore be less than the announced $30.5 million.

The transaction is designed to eliminate all mandatory principal payments on the First Lien Notes through the end of 2027. If successful, no principal payment will be due until March 31, 2028.

Virgin Galactic stated it expects to begin commercial operations in the fourth quarter of 2026. The company said the redemption aligns with its capital management strategy and should reduce ongoing cash interest obligations.