ProLogis is one of the nation's largest industrial REITs,controlling 1,664 distribution facilities worldwide. ProLogis'portfolio includes 185.2-million sf of distribution facilitiesowned, managed or under development.

"Historically, customers located in industrial settings have hadfew choices for Internet access, often sacrificing speed due tohigh cost," says Dan Ankeny, president and CEO of Carlsbad,CA.-based PhatPipe. "We believe the market for broadband saleswithin the under served US industrial sector is approximately $11billion, while the potential represented by the portfolios of ourcommitted partners is nearly $300 million. Obviously, there is atremendous opportunity to further penetrate this sizablemarket."

Under the agreement, ProLogis will invest $8 million in PhatPipepreferred stock, representing an equity position of 19.85% uponclosing. In addition, ProLogis will receive $8 million in PhatPipepreferred stock, representing another 19.85% ownershipinterest.