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Illustration: Lazaro Gamio/Axios

The Carlyle Group and GIC aren't proceeding with their $900 million deal for a 20% stake in American Express Global Business Travel, claiming that the sellers didn't meet closing conditions. The two sides are now suing each other, with a Delaware court to hear the case on Thursday.

Why it matters: This could lead to the first judicial ruling over whether or not the coronavirus pandemic has tripped a material adverse effect (MAE) clause in a merger agreement. Every deal is unique, but this could establish some broad legal guardrails.

At issue: Carlyle and GIC not only argue for the existence of an MAE, due to the global travel slowdown, but also that the sellers violated financing terms by planning to use proceeds to bolster the company's balance sheet (i.e., a de facto bailout) rather than to fund a potential acquisition and provide shareholder dividends. Amex GBT argues that Carlyle and GIC are wrong on both counts.

The bottom line: This is a broader test case than was L Brands vs. Sycamore Partners over Victoria's Secret, which ended after L Brands inexplicably gave up, where the MAE had an explicit carve-out for pandemics.

Go deeper

The rebellion against Silicon Valley (the place)

Photo illustration: Sarah Grillo/Axios. Smith Collection/Gado via Getty Images

Silicon Valley may be a "state of mind," but it's also very much a real enclave in Northern California. Now, a growing faction of the tech industry is boycotting it.

Why it matters: The Bay Area is facing for the first time the prospect of losing its crown as the top destination for tech workers and startups — which could have an economic impact on the region and force it to reckon with its local issues.

Erica Pandey, author of @Work
57 mins ago - Economy & Business

Telework's tax mess

Illustration: Annelise Capossela/Axios

As teleworkers flit from city to city, they're creating a huge tax mess.

Why it matters: Our tax laws aren't built for telecommuting, and this new way of working could have dire implications for city and state budgets.

Wanted: New media bosses, everywhere

Illustration: Sarah Grillo/Axios

The Washington Post, Los Angeles Times, Reuters, HuffPost and Wired are all looking for new editors. Soon, The New York Times will be too.

Why it matters: The new hires will reflect a new generation — one that's addicted to technology, demands accountability and expects diversity to be a priority.