Exhibit 10.2
April 25, 2002
SUSA Partnership, LP
000 Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Ladies and Gentlemen:
This letter agreement supplements the credit agreement entered into
between SC Realty Incorporated (the "Lender") and SUSA Partnership, LP (the
"Borrower") dated as of April 25, 2002. The purpose of this letter agreement is
to outline the terms and conditions under which the Lender will provide the
Borrower same day access to funds in order to meet working capital needs. It
also confirms our mutual desire to minimize the Borrower's cash balances and to
target a daily cash balance of zero dollars.
The Lender hereby agrees to provide short-notice, incremental funding
on an as-needed basis in the form of a Cash Pool Account. The amount that the
Borrower borrows from, or repays to, its Cash Pool Account will be determined
daily by the Borrower's cash management staff, with the goal of providing for
the Borrower's cash needs for the day while targeting an end-of-day cash balance
of zero dollars. Under this agreement, the limit of the Lender's funding to the
Borrower will be $5 million. In the event that the borrower needs to borrow an
amount in excess of $5 million, the Borrower will plan appropriately and borrow
under its line of credit facility (LOC).
On days when the Borrower has an outstanding loan balance in its Cash
Pool Account, a daily interest charge will be added to the balance by using the
current one-month LIBOR plus 120 basis points divided by 360 days. On days when
Borrower has a cash balance in its Cash Pool Account, the SCG Cash Management
Department will apply the proceeds to any outstanding balance under the
Borrower's LOC. If additional cash remains, it will accrue interest at a daily
rate obtained by using the current one-month LIBOR plus 120 basis points divided
by 360 days.
Transactions under this letter agreement will be initiated by faxing a
completed Cash Pool Account Borrowing and Contribution Request (attached as
Exhibit I) to SCG Analyst - Cash Management at (000) 000-0000.
SCG's Cash Management Department will provide the Borrower with a daily
report, showing daily activity and current balance on the Borrower's Cash Pool
Account. This information will also be tracked by the SCG Accounting Department.
The intent of this agreement is to provide liquidity on a short-notice
basis for daily routine cash needs and to facilitate the elimination of cash
balances when pre-payable debt is outstanding. It is not meant to replace the
Borrower's LOC, which will continue to be utilized
as the primary source for major debt financing. It is expected that the
long-term monthly average balance in the Cash Pool Account will migrate to zero,
as the main purpose of this account is to bridge timing differences in routine
cash in-flows and out-flows. Both parties understand that the cash collections
and disbursements of the Borrower reflect the unique characteristics and timing
of the storage business. Both Parties agree to work together to modify this
agreement as needed to maximize efficiency and minimize cost.
This agreement can be terminated by either party with 30 days notice,
or as otherwise agreed to.
Please sign below and return a copy for our records.
SC REALTY INCORPORATED
By /s/ Xxxxxxx X. Xxxxx
--------------------
Title: Senior Vice President
ACKNOWLEDGED BY:
SUSA Partnership, LP
By:
/s/ Xxxxxxxxxxx X. Xxxx
-----------------------
Title: Chief Financial Officer
SUSA PARTNERSHIP, LP
EXHIBIT I
CASH POOL ACCOUNT BORROWING and CONTRIBUTION REQUEST
Submission Pursuant To Letter Agreement. This Request is delivered to you
pursuant to the Cash Pool Letter Agreement, dated as of April 25, 2002
(together with all amendments, if any, from time to time made thereto, the
"Cash Pool Agreement"), between SUSA PARTNERSHIP, LP (the "Borrower"), and
------------------- --------
SC Realty, Incorporated (the "Lender").
Request For Borrowing or Notice of Contribution. Borrower hereby requests that
Lender execute the following transaction. Contributed funds will be applied
to outstanding balances in accordance with the letter agreement.
A. Request for Borrowing
---------------------
------------
Amount of Loan: $
(Not to exceed $5MM outstanding) ------------
Date of Advance: ------------
------------
Deposit to Account Number:
Account Name: SUSA Partnership, LP
Bank: First Tennessee Bank
Account No.: *****
Routing No.: #####
B. Notice of Contribution
----------------------
------------
a) Amount of Contribution: $
------------
b) Date of Contribution: ------------
------------
c) Deposit to Account Number:
Account Name: SC Realty, Incorporated
Bank: Mellon Bank
Account No.: *****
Routing No.: #####
Execution Authorized.
SUSA PARTNERSHIP, LP
By:
_______________________
Xxxx Xxxxxx
Title:
