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Shares in Hertz Global Holdings Inc., after a brief head-scratching rally, are now in danger of being ejected from the New York Stock Exchange, calming a speculative frenzy around the bankrupt car-rental company, WSJ Pro Bankruptcy reported. Hertz said yesterday that it was appealing an NYSE delisting decision that would push trading of the company’s shares to over-the-counter platforms. Delisting typically drains value from equities as investors lose confidence, raising risks for the many inexperienced traders who piled into Hertz after it filed for bankruptcy last month. The trading surge pushed Hertz shares up nearly 500 percent after billionaire Carl Icahn dumped his stake in the company at 72 cents a share last month. On Wednesday, after the delisting disclosure, the stock was down 27 percent. The shares will continue trading on the NYSE pending the outcome of Hertz’s appeal, the car-rental company said. However, “there can be no assurance that the NYSE will grant the company’s request for continued listing at the hearing and whether there will be equity value in the company’s common stock,” Hertz said.

Gym chain 24 Hour Fitness Worldwide Inc. laid off an undisclosed number of employees in multiple states via a series of phone calls yesterday, as the company struggles to address the financial impact of closures during the coronavirus pandemic, the Wall Street Journal reported. In the latest example of a remote layoff, 24 Hour Fitness employees received an email on Monday from Tami Majer, chief human resources officer, asking them to join a phone call yesterday for “important company updates.” The message stated that employees would be compensated for one hour of work and asked them not to share the call-in details. According to multiple employees interviewed, those who joined the calls learned they would be laid off, effective immediately. No information about severance or continued benefits was provided on the call, according to the employees. The company later sent an email to laid-off employees, who included fitness instructors, personal trainers and sales staff. As a result of the economic impact from the coronavirus, 24 Hour Fitness “had to take the very difficult action of separating from employment many team members across the organization,” according to the email.

Simon Property Group Inc. is terminating its $3.6 billion bid to buy Taubman Centers Inc., arguing that its rival mall owner has breached the merger agreement by not taking steps to mitigate the fallout from the coronavirus pandemic, Bloomberg News reported. Simon said yesterday that it has “exercised its contractual rights” to terminate the deal, which was announced in February before the pandemic battered malls. The company said that it was asking a court to declare that Taubman has suffered a “material adverse event” and “breached the covenants in the merger agreement.” Taubman’s shares have been trading below the proposed deal price of $52.50 for months, raising speculation that the deal was in trouble or that Simon would seek to lower its bid.

Bankrupt retailers that are closing their stores are in line to pocket millions of dollars in prepaid gift cards that might never be redeemed, WSJ Pro Bankruptcy reported. The COVID-19 pandemic has triggered a spate of retail-sector bankruptcies in recent weeks, including those of department-store chain J.C. Penney Co., luxury retailer Neiman Marcus Group Inc. apparel seller J.Crew Group Inc. and discount home-goods retailer Tuesday Morning Corp. As other retailers, such as Pier 1 Imports Inc., permanently close their stores, shoppers need to use their gift cards as soon as possible, experts say. Otherwise, the cards might soon be worthless. “The time to act is usually fairly quickly,” said Clint Krislov of Krislov & Associates Ltd., a Chicago-based firm that has represented holders of gift cards in the bankruptcies of bookstore chain Borders and specialty retailer Sharper Image. “But some people instead let the gift cards sit in that back drawer somewhere and don’t do anything about it.” Retailers that filed for bankruptcy and are shutting down stores usually give gift-card owners about a month to use them. All retailers have to receive court approval if they want to continue accepting gift cards in bankruptcy. About $2 billion to $4 billion, or up to 4 percent, of gift cards typically go unused every year in the U.S., according to research and advisory services firm Mercator Advisory Group Inc.

Bankruptcy Judge David Jones said at a hearing yesterday that he will order J.C. Penney Co. to pay as much as $250,000 in professional fees to support an informal group of shareholders who have been challenging the bankruptcy, Bloomberg News reported. In exchange, the group of retail investors agreed to nix its attempt to have the whole case thrown out along with its request for status as an official group, which could’ve resulted in huge legal bills for J.C. Penney. Judge Jones said that he views the compromise as a way to help educate shareholders on where the case is headed and how bankruptcy works. “I’m looking at this as a very reasonable expenditure to further education and promote discussion,” Jones said. “It’s not a war chest.” The news comes on the heels of a surge in the stock prices of J.C. Penney and other bankrupt companies. Some of the retailer’s debt, which ranks well above shares in the repayment line, was valued at just 0.125 cents on the dollar in a credit-default swap auction Tuesday, implying extremely slim odds of any payout to equity investors. Still, J.C. Penney shareholders have been active participants in its bankruptcy proceedings to date. Several have asked questions during hearings, including cross-examining witnesses and pleading with Judge Jones to prevent a wipeout of the stock. In court papers, the informal stockholder group decried recent bonus payments to executives and insisted that bankruptcy could’ve been avoided.

Neiman Marcus Group Ltd. LLC filed its chapter 11 plan and company disclosures with a bankruptcy court in Houston, keeping the company on track to emerge from bankruptcy by the fall, Bloomberg Law reported. The plan and disclosures that Neiman Marcus and several affiliates filed on June 6 lays out the details of the restructuring agreement it announced when it filed for bankruptcy in May. The Dallas-based luxury retailer had about $5.5 billion in debt when it filed for chapter 11 protection with the U.S. Bankruptcy Court for the Southern District of Texas. The company is restructuring with the help of a $675 million bankruptcy loan from a group of the company’s pre-petition lenders. The court scheduled a hearing to consider the disclosure statement July 8. The company needs court approval of its disclosures before creditors can vote on the plan.

Bankrupt fitness club Gold’s Gym International Inc. is looking to sell itself via auction, with a stalking-horse bid of more than $80 million, Bloomberg Law reported. Judge Harlin D. Hale of the U.S. Bankruptcy Court for the Northern District of Texas yesterday approved bidding procedures for a July 13 auction that will lead to a sale as part of the GGI’s reorganization plan. TRT Gym Asset Holdings LLC, GGI’s majority shareholder as well as an affiliate of the debtor’s post-bankruptcy debtor-in-possession lender, is the lead bidder for the company. Its offer, subject to overbid at auction, will provide $51.3 million to pay off pre-bankruptcy lenders, $20 million for estimated outstanding DIP loans, and between $7 million and $10 million for curing defaults of any contracts or leases that the purchaser may assume as part of the sale. TRT will also pay $225,000 for distribution to unsecured creditors. If another buyer prevails at the auction, TRT will be entitled to receive a break-up fee equal to 3 percent of the purchase price.