From what I understand is the moment they request a conversion they own the shares. They may not physically have a certificate for a day or two after. However, it's their relationship with their brokerage firm that determines if the broker will sell the shares while they are still in transit, which they clearly are allowing.
First conversion came late Friday. Then another on Monday, and Tuesday. Our TA e-mailed them and me that they still had two certificates open for a total of 61,767,857 shares and need confirmation that they were sold before they can issue more on Tuesday. They confirmed that they were sold.
Now is this a short? If ownership is determined at the time of request and the broker is willing to sell shares they don't physically have, it's certainly dangerous to the converter if the stock price was to go up before their certs cleared for delivery to the buyers. Hence, the huge effort to keep the price down (VFIN, bashers, etc.) because if they sold 61 mil shares Monday and Tuesday, and the stock shot to a penny, it would be a pretty epic squeeze.
