BRE Distributes Velocity Shares

BRE Properties Inc. has given birth to a Nasdaq baby.

BRE (NYSE:BRE) said this morning it has distributed to its shareholders a majority interest in VelocityHSI, now a separate company trading on the Nasdaq Over The Counter Bulletin Board under the symbol VHSI.

The distribution occurred at a rate of one share of common stock of VHSI for every five shares of common stock of BRE. The distribution has no impact on the number of outstanding shares of BRE, and will not change the number of shares of BRE common stock held by any BRE shareholder.

BRE shareholders will have a tax basis in the distributed shares of VHSI equal to the fair market value of the VHSI shares at the time of distribution, which has been determined to be $1.20. Should BRE designate any portion of the distribution as a tax-free return of capital that would result in a reduction of basis, shareholders will be notified through distribution of form 1099-DIV at year’s end.

BRE’s transfer agent, ChaseMellon Shareholder Services, has mailed certificates representing the distributed shares in VelocityHSI to BRE shareholders of record on August 7, 2000, the record date for the distribution. ChaseMellon Shareholder Services will also be the transfer agent for VHSI.