10.1.1          FORM OF SEVERANCE AGREEMENT BETWEEN STORAGE USA, INC. AND
                DEAN JERNIGAN, CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER,
                EFFECTIVE AS OF AUGUST 16, 1999

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                               SEVERANCE AGREEMENT

         AGREEMENT effective as of August 16, 1999, by and between Storage USA,
Inc., a Tennessee corporation (the "Company"), and O. Dean Jernigan (the
"Executive").

                                   WITNESSETH:

         WHEREAS, the Company considers it essential to the best interest of its
stockholders to foster the continuous employment of key management personnel;

         WHEREAS, the Board recognizes that, as is the case with many publicly
held corporations, the possibility of a Change of Control may exist and that
such possibility, and the uncertainty and questions which it may raise among
management, may result in the departure or distraction of the Company's and its
affiliates' management personnel to the detriment of the Company and its
stockholders; and

         WHEREAS, the Board has determined that it is in the best interest of
the Company and its stockholders to enter into this Agreement in order to
reinforce and encourage the continued attention and dedication of Executive to
his assigned duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a Change of Control.

         NOW, THEREFORE, in consideration of the premises and mutual obligations
hereinafter set forth the parties agree as follows:

1) DEFINITIONS. For purposes of this Agreement, the following terms shall have
   the following definitions:

   A) "1993 OMNIBUS STOCK PLAN" means the Company's 1993 Omnibus Stock Plan, as
      amended.

   B) "1995 EMPLOYEE STOCK PURCHASE AND LOAN PLAN" means the Company's 1995
      Employee Stock Purchase and Loan Plan, as amended.

   C) "1996 OFFICERS' STOCK OPTION LOAN PROGRAM" means the Company's 1996
      Officers' Stock Option Loan Program, as amended.

   D) "ADDITIONAL AMOUNT" means the amount the Company shall pay to the
      Executive in order to indemnify the Executive against all claims, losses,
      damages, penalties, expenses, interest, and Excise Taxes (including
      additional taxes on such Additional Amount) incurred by Executive as a
      result of Executive receiving Change of Control Benefits as further
      described in Section 6 of this Agreement.

   E) "ARBITRATORS" means the arbitrators selected to conduct any arbitration
      proceeding in connection with any disputes arising out of or relating to
      this Agreement.

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   F) "AWARD PERIOD" means any period in which the Company's performance is
      measured in connection with its Shareholder Value Plan.

   G) "AWARD PLANS" mean each and every plan or program in which Executive
      receives compensation in the form of a cash bonus, shares of stock in the
      Company, Partnership Units, or Options, including, without limitation,
      compensation received pursuant to the Company's 1993 Omnibus Stock Plan,
      1995 Employee Stock Purchase and Loan Plan, 1996 Officers' Stock Option
      Loan Program, Shareholder Value Plan, and any other stock option,
      incentive compensation, profit participation, bonus or extra compensation
      plan that is adopted by the Company and in which the Company's executive
      officers generally participate.

   H) "BASE SALARY" means the annual salary paid to Executive by the Company.

   I) "BENEFIT PLANS" mean each and every health, life, medical, dental,
      disability, insurance and welfare plan maintained by the Company that are
      maintained from time to time by the Company for the benefit of Executive,
      the executives of the Company generally or for the Company's employees
      generally, provided that Executive is eligible to participate in such plan
      under the eligibility provisions thereof that are generally applicable to
      the participants thereof.

   J) "BOARD" means the Board of Directors of the Company.

   K) "CHANGE OF CONTROL" means any of the following events which occur during
      the Term of this Agreement:

      i) any "person", as that term is used in Section 13(d) and Section
      14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange
      Act"), becomes, is discovered to be, or files a report on Schedule 13D or
      14D-1 (or any successor schedule, form or report) disclosing that such
      person is a beneficial owner (as defined in Rule 13d-3 under the Exchange
      Act or any successor rule or regulation), directly or indirectly, of
      securities of the Company representing 25% or more of the combined voting
      power of the Company's then outstanding securities entitled to vote
      generally in the election of directors, without the approval of the Board
      of the acquisition of such securities by the acquiring person;

      ii) any "person", as that term is used in Section 13(d) and Section
      14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange
      Act"), becomes, is discovered to be, or files a report on Schedule 13D or
      14D-1 (or any successor schedule, form or report) disclosing that such
      person is a beneficial owner (as defined in Rule 13d-3 under the Exchange
      Act or any successor rule or regulation), directly or indirectly, of
      securities of the Company representing 25% or more of the combined voting
      power of the Company's then outstanding securities entitled to vote
      generally in the election of directors, regardless of whether or not the
      Board shall have approved the acquisition of

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      such securities by the acquiring person; if, at any time within three (3)
      years after the acquisition of such securities, those individuals who
      constituted the Board at the time of the acquisition of such securities
      cease for any reason to constitute at least a majority of the Board of
      Directors of the Company;

      iii) any "person", as that term is used in Section 13(d) and Section
      14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange
      Act"), becomes, is discovered to be, or files a report on Schedule 13D or
      14D-1 (or any successor schedule, form or report) disclosing that such
      person is a beneficial owner (as defined in Rule 13d-3 under the Exchange
      Act or any successor rule or regulation), directly or indirectly, of
      securities of the Company representing 49.9% or more of the combined
      voting power of the Company's then outstanding securities entitled to vote
      generally in the election of directors, regardless of whether or not the
      Board shall have approved the acquisition of such securities by the
      acquiring person;

      iv) individuals who, as of the effective date of this Agreement,
      constitute the Board of Directors of the Company cease for any reason to
      constitute at least a majority of the Board of Directors of the Company,
      unless any such change is approved by the vote of at least 80% of the
      members of the Board of Directors of the Company in office immediately
      prior to such cessation;

      v) the Company is merged, consolidated or reorganized into or with another
      corporation or other legal person, or securities of the Company are
      exchanged for securities of another corporation or other legal person, and
      immediately after such merger, consolidation, reorganization or exchange
      less than 75% of the combined voting power of the then-outstanding
      securities of such corporation or person immediately after such
      transaction are held, directly or indirectly, in the aggregate by the
      holders of securities entitled to vote generally in the election of
      directors of the Company immediately prior to such transaction;

      vi) the Company in any transaction or series of related transactions,
      sells all or substantially all of its assets to any other corporation or
      other legal person and less than 75% of the combined voting power of the
      then-outstanding securities of such corporation or person immediately
      after such sale or sales are held, directly or indirectly, in the
      aggregate by the holders of securities entitled to vote generally in the
      election of directors of the Company immediately prior to such sale;

      vii) the Company and its affiliates shall sell or transfer (in a single
      transaction or series of related transactions) to a non-affiliate business
      operations or assets that generated at least two-thirds of the
      consolidated revenues (determined on the basis of the Company's four most
      recently completed fiscal quarters for which reports have been filed under
      the Exchange Act) of the Company and its subsidiaries immediately prior
      thereto;

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      viii) the Company files a report or proxy  statement  with the  Securities
      and  Exchange  Commission  pursuant  to the  Exchange  Act  disclosing  in
      response to Form 8-K (or any  successor,  form or report or item  therein)
      that a change in control of the Company has occurred;

      ix) the shareholders of the Company approve any plan or proposal for the
      liquidation or dissolution of the Company;

      x) the Company ceases to be the general partner of the Partnership or in
      any transaction or a series of transactions sells or transfers Partnership
      Units owned by the Company to a third party constituting at least 49.9% of
      the limited partnership interests in the Partnership; or

      xi) any other transaction or series of related transactions occur that
      have substantially the effect of the transactions specified in any of the
      preceding clauses in this sentence.

   L) "CHANGE OF CONTROL BENEFITS" means the Executive's receipt of the
      Termination Payment or any other payment, benefit or compensation (except
      for the Additional Amount) which the Executive receives or has the right
      to receive from the Company or any of its affiliates as a result of a
      Change of Control Termination.

   M) "CHANGE OF CONTROL TERMINATION" means (i) a Termination Without Cause of
      the Executive's employment by the Company, within (a) three (3) months
      prior to a Change of Control and in anticipation of such Change of
      Control; (b) on the date of the Change of Control; or (c) within two (2)
      years after a Change of Control or (ii) the Executive's resignation for
      Good Reason on or within two (2) years after a Change of Control.

   N) "CODE" means the Internal Revenue Code of 1986, as amended.

   O) "COMPANY" means Storage USA, Inc., a Tennessee corporation, and any
      successor to its business and/or assets which assumes and agrees to
      perform this Agreement by operation of law, or otherwise.

   P) "COMPANY SHARES" means the shares of common stock of the Company or any
      securities of a successor company which shall have replaced such common
      stock.

   Q) "EXCESS PARACHUTE PAYMENTS" has the meaning set forth in section 280G of
      the Code.

   R) "EXCISE TAX" means a tax on Excess Parachute Payments imposed pursuant to
      Code section 4999.

   S) "EXECUTIVE" means the person identified in the preamble paragraph of this
      Agreement.

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   T) "FAIR MARKET VALUE" means, on any give date, the closing sale price of the
      common stock of the Company on the New York Stock Exchange on such date,
      or, if the New York Stock Exchange shall be closed on such date, the next
      preceding date on which the New York Stock Exchange shall have been open.

   U) "GOOD REASON" means any of the following:

      i) a change in the Executive's status, position or responsibilities
      (including reporting relationships and responsibilities) which, in the
      Executive's reasonable judgment and without Executive's consent,
      represents a reduction in or demotion of the Executive's status, position
      or responsibilities as in effect immediately prior to a Change of Control;
      the assignment to the Executive of any duties or responsibilities which,
      in the Executive's reasonable judgment, are inconsistent with such status,
      position or responsibilities; or any removal of the Executive from or
      failure to reappoint or reelect the Executive to any of such positions;

      ii) the relocation of the Company's principal executive offices to a
      location outside a thirty-mile radius of Memphis, Tennessee or the
      Company's requiring the Executive to be based at any place other than a
      location within a thirty-mile radius of Memphis, Tennessee, except for
      reasonably required travel on the Company's business;

      iii) the failure by the Company to continue to provide the Executive with
      compensation and benefits provided to Executive prior to the Change of
      Control or benefits substantially similar to those provided to the
      Executive under any of the employee benefit plans in which the Executive
      is or becomes a participant, or the taking of any action by the Company
      which would directly or indirectly materially reduce any of such benefits
      or deprive the Executive of any material fringe benefit enjoyed by the
      Executive at the time of the Change of Control;

      iv) any material breach by the Company of any provision of this Agreement;
      or

      v)  the failure of the Company to obtain an agreement reasonably
      satisfactory to Executive from any successor or assign of the Company
      to assume and agree to perform this Agreement.

   V) "OPTION(S)" means any options issued pursuant to the Company's 1993
      Omnibus Stock Plan, or any other stock option plan adopted by the Company,
      any option granted with respect to Partnership Units, or any option
      granted under the plan of any successor company that replaces or assumes
      the Company's or the Partnership's options.

   W) "PARTNERSHIP" means SUSA Partnership, L.P.

   X) "PARTNERSHIP UNIT(S)" means limited partnership interests of the
      Partnership. The holder has the option of requiring the Company to redeem
      such interests. The Company may

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      elect to effectuate such redemption by either paying cash or exchanging
      Company Shares for such interests.

   Y) "PERMANENT DISABILITY" means a complete physical or mental inability,
      confirmed by a licensed physician, to perform the Executive's duties that
      continues for a period of six (6) consecutive months.

   Z) "PLAN LOAN(S)" means any loan extended by the Company to Executive
      pursuant to the 1995 Employee Stock Purchase and Loan Plan, the 1996
      Officers' Stock Option Loan Program, or any other similar plan or program
      adopted by the Company during the Term of this Agreement.

   AA) "RESTRICTED STOCK" means any restricted stock issued pursuant to the
      Company's 1993 Omnibus Stock Plan, or any other Award Plan adopted by the
      Company, or any restricted stock issued under the plan of any successor
      company that replaces or assumes the Company's grants of restricted stock.

   bb) "SELF STORAGE BUSINESS" means the business of acquiring, developing,
      constructing, franchising, owning or operating self-storage facilities.

   CC) "SELF STORAGE PROPERTY" means any real estate upon which the Self-Storage
      Business is being conducted.

   DD) "SHAREHOLDER VALUE PLAN" means the Company's Shareholder Value Plan, as
      amended.

   EE) "SVU GRANT" means the total number of shareholder value units granted to
      the Executive pursuant to the Company's Shareholder Value Plan.

   FF) "SVU VALUE" means the value of each shareholder value unit based upon
      certain performance measures as set forth in the Company's Shareholder
      Value Plan.

   GG) "TERM" has the meaning assigned to it in Section 2 of this Agreement.

   HH) "TERMINATION DATE" means the date employment of Executive is terminated,
      which date shall be the date specified as the Termination Date in the
      Termination Notice, which date shall not be less than thirty nor more than
      sixty days from the date the Termination Notice is given.

   II) "TERMINATION NOTICE" means a written notice of termination of employment
      by Executive or the Company.

   JJ) "TERMINATION PAYMENT" has the meaning set forth in Section 3(b) of this
      Agreement.

   KK) "TERMINATION WITH CAUSE" means the termination of the Executive's
      employment by the Company for any of the following reasons:

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      i)  the Executive's conviction for a felony;

      ii) the Executive's theft, embezzlement, misappropriation of or
      intentional infliction of material damage to the Company's property or
      business opportunity; or

      iii) the Executive's ongoing willful neglect of or failure to perform his
      duties hereunder or his ongoing willful failure or refusal to follow any
      reasonable, unambiguous duly adopted written direction of the Company that
      is not inconsistent with the Executive's duties, if such willful neglect,
      failure or refusal is materially damaging or materially detrimental to the
      business and operations of the Company; provided that Executive shall have
      received written notice of such failure and shall have continued to engage
      in such failure after 30 days following receipt of such notice from the
      Company, which notice specifically identifies the manner in which the
      Company believes that Executive has engaged in such failure.

For purposes of this subsection, no act, or failure to act, shall be deemed
"willful" unless done, or omitted to be done, by Executive not in good faith,
and without reasonable belief that such action or omission was in the best
interest of the Company.

   LL) "TERMINATION WITHOUT CAUSE" means the termination of the Executive's
      employment by the Company for any reason other than Termination With
      Cause, or termination by the Company due to Executive's death or Permanent
      Disability.

   MM) "UNIFORM ARBITRATION ACT" means the Uniform Arbitration Act, Tennessee
      Code Annotated ss. 29-5-391 et seq., as amended.

2) TERM; TERMINATION.

   a) The term of this Agreement hereunder shall commence on August 16, 1999 and
      shall be extended automatically, for so long as the Executive remains
      employed by the Company hereunder, on January 1 of each year beginning
      January 1, 2000 for an additional one year period (such period, as it may
      be extended from time to time, being herein referred to as the "Term"),
      unless, not later than September 30 of the preceding year, the Company
      shall have given notice that it does not wish to extend this Agreement;
      provided, further, if a Change of Control of the Company shall have
      occurred during the original or extended term of this Agreement, this
      Agreement shall automatically continue in effect for a period of
      twenty-four months beyond the month in which such Change of Control
      occurred. This Agreement shall automatically terminate upon the
      termination of Executive's employment other than by reason of a Change in
      Control Termination.

   b) Any purported termination of employment by Executive or the Company , (i)
      within three (3) months prior to a Change of Control; (ii) on the date of
      a Change of Control; or (iii)

      within two (2) years after a Change of Control shall be communicated by a
      Termination Notice. The Termination Notice shall indicate the specific
      termination provision in this Agreement relied upon and set forth the
      facts and circumstances claimed to provide a

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      basis for  termination.  If the party  receiving  the  Termination  Notice
      notifies  the other  party  prior to the  Termination  Date that a dispute
      exists concerning the termination,  the Termination Date shall be extended
      until  the  dispute  is  finally  determined,  either  by  mutual  written
      agreement of the parties,  by a binding  arbitration  award, or by a final
      judgment,  order or  decree  of a court  of  competent  jurisdiction.  The
      Termination  Date shall be  extended  by a notice of dispute  only if such
      notice is given in good faith and the party giving such notice pursues the
      resolution of such dispute with reasonable diligence.  Notwithstanding the
      pendency of any such  dispute,  the Company will continue to pay Executive
      his full compensation in effect when the notice giving rise to the dispute
      was given and Executive shall continue as a participant in all Award Plans
      and Benefit Plans in which  Executive  participated  when the  Termination
      Notice giving rise to the dispute was given,  until the dispute is finally
      resolved  in  accordance  with this  subsection.  Amounts  paid under this
      subsection  are in addition to all other amounts due under this  Agreement
      and shall not be offset against or reduce any other amounts due under this
      Agreement.

3) SEVERANCE BENEFIT IN CONNECTION WITH A CHANGE OF CONTROL TERMINATION.
  ----------------------------------------------------------------------

   a) In the event of a Change of Control Termination, the Company shall, on the
      Termination Date, pay the Executive in addition to any Base Salary earned
      but not paid through the Termination Date and any amounts due pursuant to
      Award Plans and Benefit Plans including, without limitation, the pro rata
      amount of Executive's anticipated bonus for the fiscal year in which
      Executive is terminated, the compensation and benefits set forth in this
      Section 3.

   b) The Company shall pay Executive a Termination Payment which is equal to
      the sum of three (3) times the Executive's annual Base Salary in effect on
      the Termination Date plus three (3) times the amount of the highest annual
      cash bonus paid to the Executive for the previous five fiscal years (but
      not including compensation under the Company's Shareholder Value Plan)
      ("Termination Payment"). The Termination Payment shall be calculated and
      paid immediately prior to the closing of the transactions constituting a
      Change of Control if the Executive receives notice prior to the Change of
      Control that his employment will be terminated on or after the Change of
      Control.

   c) Executive shall be permitted to participate in, and have all rights and
      benefits provided by, all Benefit Plans which Executive was eligible to
      participate in immediately prior to the Termination Date (to the extent
      such participation is possible under the laws then pertaining to such
      Benefit Plans), for two years following the Termination Date. If Executive
      is no longer eligible to participate in one or more of the Benefit Plans
      because of such termination, Executive shall be entitled to, and the
      Company shall provide to Executive at the Company's sole expense, benefits
      substantially equivalent to those

      Benefit Plans to which Executive was entitled immediately prior to such
      termination for two (2) years after the Termination Date.

   d) All restrictions upon any Restricted Stock which may have been awarded to
      Executive shall expire and be removed and such Restricted Stock shall be
      fully vested at the

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      Termination  Date  (unless  otherwise  previously  expired and removed and
      vested pursuant to the terms of any Restricted Stock award pursuant to the
      1993 Omnibus Stock Plan or any other Award Plan),  and such Stock shall be
      delivered to  Executive.  All Options  granted to  Executive  shall become
      fully vested at the Termination Date (unless  otherwise  previously vested
      pursuant to the 1993 Omnibus Stock Plan or any other Award Plan).  In lieu
      of  Company  Shares   issuable  upon  exercise  of  any   outstanding  and
      unexercised  Options  granted to Executive,  Executive may, at Executive's
      option,  receive an amount in cash equal to the  product of (i) the excess
      of  the  higher  of  the  Fair  Market  Value  of  Company  Shares  on the
      Termination  Date,  or the  highest  per share  price for  Company  Shares
      actually  paid in  connection  with any Change of Control of the  Company,
      over the per share exercise price of each Option held by Executive,  times
      (ii) the number of Company  Shares  covered  by each such  Option.  In the
      event  Executive  does  not  elect  to  receive  a cash  payment  for  any
      outstanding and unexercised Options granted to Executive,  Executive shall
      have the right to otherwise  exercise such Options in accordance  with the
      terms  and  conditions  of the  1993  Omnibus  Stock  Plan  or  any  other
      applicable  Award Plan. This Agreement shall not prevent  Restricted Stock
      or Options  from vesting  pursuant to the terms of the 1993 Omnibus  Stock
      Plan  or any  other  Award  Plan or  otherwise,  at a time  prior  to that
      provided for herein.

   e) If Executive has any Plan Loans outstanding to the Company immediately
      prior to the effective date of a Change of Control Termination, the
      Company shall, prior to the effective date of such Change of Control
      Termination discharge and cancel the amount of principal and interest due
      with respect to such Plan Loans which exceeds the Fair Market Value of
      Company Shares securing the Plan Loans. The Executive shall pay the Plan
      Loans in full (less the amount discharged) within ninety (90) days
      following the Termination Date, and shall have the option of repaying all
      amounts due with respect to the Plan Loans by the transfer of the Company
      Shares securing the Plan Loans, or by the payment, in cash, of the amounts
      due with respect to the Plan Loans. Except as otherwise set forth herein,
      Executive shall remain subject to all terms and conditions set forth in
      the Loan Agreements and Promissory Notes until the Plan Loans are paid in
      full.

   f) With respect to Executive's participation in the Company's Shareholder
      Value Plan, the Award Periods in connection with all of Executive's
      outstanding SVU Grants shall be accelerated such that each Award Period is
      deemed to have ended upon the effective date of a Change of Control
      Termination. At such time, the Company shall pay Executive an amount equal
      to the SVU Value multiplied by the number of Executive's outstanding SVU
      Grants. The SVU Value shall be reduced by 66% for all SVU Grants which
      were granted less than twelve months prior to the effective date of a
      Change of Control Termination and the SVU Value shall be reduced by 33%
      for all SVU Grants which were

      granted less than twenty-four months but more than twelve months prior to
      the effective date of a Change of Control Termination. No adjustments
      shall be made to the SVU Value for SVU Grants which were granted more than
      twenty-four months prior to the effective date of the Change of Control
      Termination. All payments made to Executive after a Change in Control
      Termination in connection with outstanding SVU Grants shall be made solely
      in cash.

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   g) The Company shall also pay to Executive all legal fees and expenses
      incurred by Executive as a result of a Change of Control Termination
      (including all such fees and expenses, if any, incurred in contesting or
      disputing any such termination or in seeking to obtain or enforce any
      right or benefit provided by this Agreement or in connection with any tax
      audit or proceeding to the extent attributable to the application of
      Section 4999 of the Code to any payment or benefit provided hereunder).

4) CERTAIN TRANSACTIONS. Notwithstanding the provisions of Sections 1(k)(i),
   (ii), (iii) or (viii), unless otherwise determined in a specific case by
   majority vote of the Board, a Change of Control shall not be deemed to have
   occurred for purposes of this Agreement solely because (i) an entity in which
   the Company directly or indirectly beneficially owns 50% or more of the
   voting securities or (ii) any Company-sponsored employee stock ownership
   plan, or any other employee benefit plan of the Company, either files or
   becomes obligated to file a report or a proxy statement under or in response
   to Schedule 13D, Schedule 14D-l, Form 8-K or Schedule 14A (or any successor
   schedule, form or report or item thereon) under the Exchange Act, disclosing
   beneficial ownership by it of shares of stock of the Company, or because the
   Company reports that a Change of Control of the Company has or may have
   occurred or will or may occur in the future by reason of such beneficial
   ownership.

5) ESCROW ARRANGEMENT. If within thirty (30) days after the effective date of a
   Change of Control, Executive's employment has not been terminated, the
   Company shall, at the request of Executive, deposit with an escrow agent,
   pursuant to an escrow agreement between the Company and such escrow agent, a
   sum of money, or other property permitted by such escrow agreement, which is
   substantially sufficient in the opinion of the Company's management to fund
   the amounts due to Executive set forth in Section 3 of this Agreement. The
   escrow agreement shall provide that such agreement may not be terminated
   until the earlier of (i) Executive's employment has terminated and all
   amounts due to Executive as set forth in this Agreement have been paid to
   Executive or (ii) two (2) years after the effective date of the Change of
   Control.

6) TAX MATTERS. If the Excise Tax on Excess Parachute Payments will be imposed
   on the Executive under Code section 4999 as a result of the Executive's
   receipt of the Change of Control Benefits, the Company shall indemnify the
   Executive and hold him harmless against all claims, losses, damages,
   penalties, expenses, interest, and Excise Taxes. To effect this
   indemnification, the Company shall pay to the Executive the Additional Amount
   which is sufficient to indemnify and hold the Executive harmless from the
   application of Code sections 280G and 4999, including the amount of (i) the
   Excise Tax that will be imposed on

   the Executive under section 4999 of the Code with respect to the Change of
   Control Benefits; (ii) the additional (A) Excise Tax under section 4999 of
   the Code, (B) hospital insurance tax under section 3111(b) of the Code and
   (C) federal, state and local income taxes for which the Executive is or will
   be liable on account of the payment of the amount described in subitem (i);
   and (iii) the further excise, hospital insurance and income taxes for which
   the Executive is or will be liable on account of the payment of the amount
   described in subitem (ii) and this subitem (iii) and any other
   indemnification payment under this Section 6. The Additional

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      Amount shall be calculated  and paid to the Executive at the time that the
      Termination  Payment  is  paid  to  the  Executive.   In  calculating  the
      Additional  Amount,  the highest  marginal rates of federal and applicable
      state and local income taxes  applicable to individuals  and in effect for
      the year in which the Change of Control  occurs shall be used.  Nothing in
      this   paragraph   shall   give  the   Executive   the  right  to  receive
      indemnification from the Company for federal,  state or local income taxes
      or hospital  insurance taxes payable solely as a result of the Executive's
      receipt  of (a) the  Change in  Control  Benefits,  or (b) any  additional
      payment,  benefit or  compensation  other than the Additional  Amount.  As
      specified in items (ii) and (iii),  above, all income,  hospital insurance
      and additional Excise Taxes resulting from additional  compensation in the
      form of the Excise Tax payment specified in item (i), above, shall be paid
      to the Executive.

      The provisions of this Section 6 are illustrated by the following example:

         Assume that the Termination Payment and all other Change of Control
Benefits result in a total federal, state and local income tax and hospital
insurance tax liability of $180,000; and an Excise Tax liability under Code
section 4999 of $70,000. Under such circumstances, the Executive is solely
responsible for the $180,000 income and hospital insurance tax liability; and
the Company must pay to the Executive $70,000, plus an amount necessary to
indemnify the Executive for all federal, state and local income taxes, hospital
insurance taxes, and Excise Taxes that will result from the $70,000 payment to
the Executive and from all further indemnification to the Executive of taxes
attributable to the initial $70,000 payment.

7) EMPLOYMENT STATUS. The parties acknowledge and agree that Executive is an
   employee of the Company or of one of its affiliates, not an independent
   contractor. Any payments made to Executive by the Company pursuant to this
   Agreement shall be treated for federal and state payroll tax purposes as
   payments made to a Company employee, irrespective whether such payments are
   made subsequent to the Termination Date.

8) NONCOMPETITION; NONSOLICITATION. For a period of two (2) years after
   Executive receives Change of Control Benefits pursuant to the terms of this
   Agreement, Executive shall not solicit any employee of the Company to leave
   the service of the Company or own any interest in any Self-Storage Property
   (other than any permissible interest acquired while Executive was employed by
   the Company) as partner, shareholder or otherwise; or directly or indirectly,
   for his own account or for the account of others, either as an officer,
   director, promoter, employee, consultant, advisor, agent, manager, or in any
   other capacity, engage in the Self-Storage Business.

         The nonsolicitation provision shall apply to any Company employee
during the period of such Company employee's employment with the Company and for
a period of 30 days after such employee's termination of employment with the
Company. The Executive agrees that damages at law for violation of the
restrictive covenant contained herein would not be an adequate or proper remedy
to the Company, and that should the Executive violate or threaten to violate any
of the provisions of such covenant, the Company, its successors or assigns,
shall be entitled to obtain a temporary or permanent injunction, as appropriate,
against the Executive in any court having jurisdiction over the person and the
subject matter, prohibiting any further violation of

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<PAGE>
any such covenants. The injunctive relief provided herein shall be in addition
to any award of damages, compensatory, exemplary or otherwise, payable by reason
of such violation.

         Furthermore, the Executive acknowledges that this Agreement has been
negotiated at arms' length by the parties, neither being under any compulsion to
enter into this Agreement, and that the foregoing restrictive covenant does not
in any respect inhibit his ability to earn a livelihood in his chosen profession
without violating the restrictive covenant contained herein. The Company by this
Agreement has attempted to limit the Executive's right to compete only to the
extent necessary to protect the Company from unfair competition. The Company
recognizes, however, that reasonable people may differ in making such a
determination. Consequently, the Company agrees that if the scope or
enforceability of the restricted covenant contained herein is in any way
disputed at any time, a court or other trier of fact may modify and enforce the
covenant to the extent that it believes to be reasonable under the circumstances
existing at the time.

9) NOTICES. All notices or deliveries authorized or required pursuant to this
   Agreement shall be deemed to have been given when in writing and personally
   delivered or when deposited in the U.S. mail, certified, return receipt
   requested, postage prepaid, addressed to the parties at the following
   addresses or to such other addresses as either may designate in writing to
   the other party:

                   To the Company:            165 Madison
                                              Suite 1300
                                              Memphis, TN 38103
                                              Attn: General Counsel

                  To the Executive:           O. Dean Jernigan
                                              6366 Lendenwood
                                              Memphis, TN  38120

10) ENTIRE AGREEMENT. This Agreement contains the entire understanding between
   the parties hereto with respect to the subject matter hereof and shall not be
   modified in any manner except by instrument in writing signed, by or on
   behalf of, the parties hereto. This Agreement shall be binding upon and inure
   to the benefit of the heirs, successors and assigns of the parties hereto.

11) ARBITRATION. Any controversy concerning or claim arising out of or relating
   to this Agreement shall be settled by final and binding arbitration in
   Memphis, Shelby County, Tennessee at a location specified by the party
   seeking such arbitration.

   A) THE ARBITRATORS. Any arbitration proceeding shall be conducted by three
      (3) Arbitrators and the decision of the Arbitrators shall be binding on
      all parties. Each Arbitrator shall have substantial experience and expert
      competence in the matters being arbitrated. The party desiring to submit
      any matter relating to this Agreement to arbitration shall do so by
      written notice to the other party, which notice shall set forth the items
      to be arbitrated, such party's choice of Arbitrator, and such party's
      substantive position in the arbitration.

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<PAGE>
      The party  receiving  such notice  shall,  within  fifteen (15) days after
      receipt of such notice,  appoint an Arbitrator  and notify the other party
      of its  appointment  and  of its  substantive  position.  The  Arbitrators
      appointed by the parties to the  Arbitration  shall  select an  additional
      Arbitrator meeting the aforedescribed  criteria.  The Arbitrators shall be
      required to render a decision in accordance  with the procedures set forth
      in Subparagraph  (b) below within thirty (30) days after being notified of
      their  selection.  The fees of the  Arbitrators  shall be equally  divided
      amongst the parties to the arbitration.

   B) ARBITRATION PROCEDURES. Arbitration shall be conducted in accordance with
      the Uniform Arbitration Act, except to the extent the provisions of such
      Act are modified by this Agreement or the subsequent mutual agreement of
      the parties. Judgment upon the award rendered by the Arbitrator(s) may be
      entered in any court having jurisdiction thereof. Any party hereto may
      bring an action, including a summary or expedited proceeding, to compel
      arbitration of any controversy or claim to which this provision applies in
      any court having jurisdiction over such action in Shelby County,
      Tennessee, and the parties agree that jurisdiction and venue in Shelby
      County, Tennessee are appropriate and approved by such parties.

12) APPLICABLE LAW. This Agreement shall be governed and construed in accordance
    with the laws of the State of Tennessee.

13) ASSIGNMENT. The Executive acknowledges that his services are unique and
    personal. Accordingly, the Executive may not assign his rights or delegate
    his duties or obligations under this Agreement.

14) HEADINGS. Headings in this Agreement are for convenience only and shall not
    be used to interpret or construe its provisions.

15) SUCCESSORS; BINDING AGREEMENT. The Company will require any successor to all
    or substantially all of the business and/or assets of the Company to
    expressly assume and agree to perform this Agreement in the same manner and
    to the same extent that the Company would be required to perform it if no
    such succession had taken place. Failure of the Company to obtain such
    assumption and agreement prior to the effectiveness of any such succession
    shall be a beach of this Agreement and shall entitle Executive to
    compensation from the Company in the same amount and on the same terms as
    Executive would be entitled

    to hereunder if Executive terminates his employment for Good Reason on or
    within three (3) years after a Change of Control. The Company's rights and
    obligations under this Agreement shall inure to the benefit of and shall be
    binding upon the Company's successors and assigns.

16) CLAIMS. If Executive believes that he is being denied a benefit to which he
    is entitled under this Agreement, he may file a written request for such
    benefit with the Company at the address specified in Section 9 above setting
    forth his claim. The Company shall have the sole discretion and authority to
    construe and interpret the provisions of this Agreement and determine the
    disposition of the Executive's claim. The Company shall advise the
    Executive, in writing, of its decision and if the claim is denied, the
    specific reason therefor, with

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<PAGE>
      reference  to the  terms  of this  Agreement,  describing  any  additional
      information  that  may be  necessary,  and  explaining  the  claim  review
      procedure set forth herein. The Executive may then appeal such denial to a
      committee  appointed by the Chairperson of the  Compensation  Committee of
      the Board of Directors of the Company  within sixty (60) days,  may review
      any pertinent  documents,  and submit issues and comments in writing.  The
      committee  shall then render a decision on review  within ninety (90) days
      of  the  Executive's  appeal,  unless  special  circumstances  require  an
      extension,  in which  case such  decision  shall be  rendered  within  one
      hundred  twenty  (120) days.  The  decision on review shall be in writing,
      final, and conclusive.

         IN WITNESS WHEREOF, the parties have executed this Agreement effective
     as of the date first above written.

                                       STORAGE USA, INC.


                                       By:
                                          --------------------------------
                                       Name:  Harry Thie
                                       Title: Director and
                                              Chairman, Compensation Committee
                                              of the Board of Directors


                                       By:
                                          ---------------------------------
                                       Name:  John W. McConomy
                                       Title: Executive Vice President
                                              and General Counsel


                                       EXECUTIVE:


                                       -----------------------------------
                                       Name:  O. Dean Jernigan

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