Cal-Bay International Inc (CBYI)

[Terrorballs]

Where do you get that they will not have to cover just because they aren't on the threshold list for the 12th?

Because that means currently, there are not enough FTDs for them to be on that list. Which means they are not subject to the close-out requirements at all. Even if there is a naked short position here, it's not significant because if it was, we'd be on the threshold list. I'd also like to note that we're not on the list for the 15th, either.

Wouldn't we need to wait 5 days from the 15th to see if there where grandfathered shorts?

I think you're misunderstanding something here. "Grandfathered shorts" are the FTDs that occur before a security is on the threshold list. Prior to October 15th, only the FTDs issued after a security was on the threshold list had to be covered, whereas the ones issued before that never had to be covered. Now, the grandfathered shorts have to be covered too. Once again, this only applies for securities on the threshold list.

To summarize, CBAY is not on the threshold list, which means it has only a small naked short position, if it even has one at all. So even if these shares were covered it would make little difference.