Dune (NASDAQ:DUNE) filed an initial proxy to extend its transaction deadline in the latest change of direction in its zig-zagging process concerning its pending combination with equities trading platform TradeZero.

The move caps off a strange month for Dune, in which it launched a lawsuit against TradeZero while its Board still recommended shareholders vote in favor of the merger, then changing this recommendation to “against” earlier this week, and now focusing on an extension vote before a completion vote.

Back when the suit was announced, we walked through the options for Dune with its transaction deadline coming up on June 22, 2022. Essentially: 1.) Terminate the transaction, extend the deadline and find a new deal. 2.) Terminate and liquidate. 3.) Put it to a completion vote and either close or liquidate with a “no” vote.

Because some conditions appear to be preventing Dune from terminating now and it would prefer to not liquidate, it appears to be taking a slightly different version of option #1 here. This would extend Dune’s transaction deadline to a point beyond the deal’s outside date, which is July 12th, at which time either party can walk away and Dune can then seek a new deal.

This is still a bit of a gamble, however. Dune is asking for an 18-month extension rather than the usual three or six months. Compared to the terms freshly IPO’d SPACs have been able to get in the current market, this is the equivalent of asking for a complete re-do. Its new transaction deadline would be pushed all the way to December 22, 2023. Dune’s extension proxy also does not currently show the sponsors making a contribution to trust to extend. Although, that might get added in subsequent filings.  However, to attempt an 18-month extension without any sort of contribution to trust for investors who have already hung in there for 18-months, would most likely result in a significant amount of redemptions.

Even with a contribution, the average redemption rates for SPACs that have held extension votes in 2022 and are still searching or working to close an announced deal has been 48%.

But, this is just an initial proxy.  Additionally, Dune has pledged to release additional information about the boards decision on a “no vote” for their combination with TradeZero by saying they intend, “… to more fully describe the reasons for the Board’s change in recommendation in the next filing of the Deal Proxy Statement.” The proxy also noted that TradeZero filed a motion to dismiss Dune’s lawsuit May 5, so there could be news on the litigation front soon as well.