<PAGE>


                              EMPLOYMENT AGREEMENT

         This Employment Agreement (the "AGREEMENT") dated as of June 12, 2000,
is entered between Meditrust Corporation (the "COMPANY") and David L. Rea (the
"EXECUTIVE").

         WHEREAS, the Company and the Executive wish to enter into an employment
agreement whereby the Executive will be employed by the Company in accordance
with the terms and conditions stated below;

         NOW, THEREFORE, the parties hereby agree as follows:

                                    ARTICLE I

                     EMPLOYMENT, DUTIES AND RESPONSIBILITIES

         1.1 EMPLOYMENT. The Executive shall serve as the Executive Vice
President, Chief Financial Officer and Treasurer of the Company. The Executive
hereby accepts such employment. The Executive agrees to devote substantially all
of his time and efforts to promoting the interests of the Company.

         1.2 DUTIES AND RESPONSIBILITIES. Subject to the supervision of and
direction by the Board of Directors of the Company, the Executive shall (a)
perform such duties as are customarily associated with the position of Executive
Vice President, Chief Financial Officer and Treasurer, and (b) be responsible
for the management of the Tax, Accounting, Internal Audit, and Treasury
departments.

         1.3 BASE OF OPERATION. The Executive's principal base of operation for
the performance of his duties and responsibilities under this Agreement shall be
the offices of the Company in Dallas, Texas.

                                   ARTICLE II

                                      TERM

         2.1 TERM. The term of this Agreement (the "TERM") shall commence on or
before June 12, 2000, and shall continue for a period of THREE YEARS from the
commencement date hereof. The Term and this Agreement will be renewed
automatically thereafter for successive one-year terms unless 6 months notice of
non-renewal is given by either party to the other. Regardless of the term
remaining on this Agreement determined as provided above, upon the occurrence of
a Change of Control of the Company, the Term of this Agreement shall not expire
until the later of the end of the remaining term then in effect or two years
from the date of such Change of Control. The Executive shall use his best
efforts to commence his employment by June 26, 2000 consistent with any other
employment obligations that he may have.


<PAGE>


                                   ARTICLE III

                            COMPENSATION AND EXPENSES

         3.1 SALARY AND BENEFITS. As compensation and consideration for the
performance by the Executive of his obligations under this Agreement, the
Executive shall be entitled to the following (subject, in each case, to the
provisions of Article V hereof):

                  (a) The Company shall pay the Executive a base salary, payable
in accordance with the ordinary payment procedures of the Company and subject to
such withholdings and other ordinary employee deductions as may be required by
law. The total base salary paid to the Executive for the first year of this
Agreement shall be $375,000. The base salary to be paid the Executive during the
Term for subsequent years shall be reviewed on an annual basis, beginning in
January 2001, but in no event shall such base salary be less than $375,000 per
annum.

                  (b) The Executive shall participate during the Term in the
annual cash bonus plan maintained by the Company, subject to the goals and
criteria established by the Compensation Committee of the Company from time to
time. For the year 2000, the Company shall pay the Executive an end-of-year
bonus of no less than the pro rata amount of an annual bonus of $281,250, based
on the number of days worked in 2000, payable in accordance with the ordinary
payment procedures of the Company and subject to such withholdings and other
ordinary employee deductions as may be required by law. Executive's base target
bonus opportunity for each fiscal year for satisfaction of goals for such fiscal
year shall be 75 percent of Executive's base salary ("Base Target"). In the
event Executive significantly exceeds annual goals for any fiscal year, he may
receive a cash bonus of up to 150 percent of Executive's base salary.

                  (c) The Company shall contribute $1000 per year to Executive's
Individual Life Insurance Trust, to be paid annually on the anniversary date of
the insurance policy.

                  (d) The Executive shall participate during the Term in such
retirement, pension, health, and medical insurance plans, and in such other
employee benefit plans and programs, as may be maintained from time to time
during the Term by the Company for the benefit of the employees of the Company,
in each case to the extent and in such manner available to other executive
officers of the Company and subject to the terms and provisions of such plans or
programs.

                  (e) The Executive shall be entitled to an annual paid vacation
period (but not necessarily consecutive vacation weeks) during the Term, in
accordance with the Company's employee benefit policies, but in no event less
than four weeks per year.

                  (f) The Company will pay any COBRA costs incurred by Executive
under his current employer's program until Executive is eligible to freely
participate in Company's healthcare benefits.


                                      -2-
<PAGE>

         3.2 SIGN UP BONUS. Upon execution of this agreement the Company shall
pay Executive $150,000 subject to such withholdings and other ordinary employee
deductions as may be required by law.

         3.3 EXPENSES. The Company will reimburse the Executive for reasonable
business-related expenses incurred by him in connection with the performance of
his duties hereunder during the Term subject, however, to the Company's policies
relating to business-related expenses as in effect from time to time during the
Term. The Company will reimburse the Executive, in accordance with the Company's
relocation policy, for all reasonable and normal costs related to relocating his
permanent residence from the Columbus, Ohio area to Dallas, Texas, (including
packing, moving and unpacking). All payments made to Executive under this
Section 3.3 shall be "grossed up" to the greater amount so that the net benefit
to Executive after taxes equals his actual expense relating to such relocation.
Company will pay closing costs relating to the sale of the Columbus residence
and the purchase of a residence in the Dallas area to include up to four points
for a mortgage. Company will likewise pay all temporary living expenses in
Dallas, as well as all reasonable commuting expenses to and from Columbus.
Company further will agree to buy Executive's Columbus residence at a cost of
$421,000 if such residence is not sold in a 45 day period from the time the
residence is listed with an approved broker.

         3.4 STOCK COMPENSATION. As compensation and consideration for the
performance by the Executive of his obligations under this Agreement, the
Executive shall be entitled to the following (subject, in each case, to the
provisions of Article V hereof):

                  (a) PERFORMANCE SHARES. The Company shall award to the
Executive 300,000 shares of the common stock of the Company and shares of the
common stock of The Meditrust Operating Company which are paired for trading
purposes ("Paired Shares") in accordance with the terms described below and the
Company's 1995 Share Award Plan (the "Award" of the "Performance Shares" under
the "Plan"):

                           (i) the Performance Shares shall be deemed issued as
                  of the first day of the Term ("Issue Date")upon payment of
                  $.20 per paired share thereof to the Company. Subject to the
                  terms of an agreement to be entered into between the Executive
                  and the Company related to the Award (the "Award Agreement"),
                  the Performance Shares shall vest on the third anniversary of
                  the Issue Date or, if sooner, the first business day after 30
                  consecutive days on which the closing price (the "30-Day
                  Closing Price") of a Paired Share equals or exceeds three
                  times the closing price for a Paired Share on June 12, 2000
                  (the "Benchmark Share Price").

                           (ii) the Executive shall receive all voting rights
                  and dividends paid with respect to unvested Performance Shares
                  from the date of issuance so long as the Executive is an
                  employee of the Company and the Executive shall have no
                  obligation to return any funds or other property received as
                  dividends or otherwise with respect to the Performance Shares,
                  regardless of whether such shares are vested.

                           (iii) upon the consummation of a Change in Control,
                  as defined herein,


                                      -3-

<PAGE>

                                    (1) all unvested Performance Shares shall
                           become fully vested immediately prior to the
                           consummation of the Change in Control.

                  (b) STOCK OPTIONS. On the first day of the Term, the Company
shall award to the Executive options to purchase 900,000 Paired Shares (the
"Options") subject to the Award Agreement which shall include the following
provisions:

                           (i) The Option exercise price with respect to 450,000
                  Paired Shares (Option A) shall be equal to the Benchmark Share
                  Price. Option A shall become exercisable in 25% increments on
                  each anniversary of the Issue Date (an "A-Annual Tranche") so
                  that Option A is fully exercisable on the fourth anniversary
                  of the Issue Date; provided, however, at the first such time
                  as the 30-Day Closing Price equals or exceeds three times the
                  Benchmark Share Price, the Paired Shares subject to Option A
                  shall accelerate and become exercisable as to any Paired
                  Shares not yet fully exercisable.

                           (ii) The Option exercise price with respect to
                  450,000 Paired Shares (Option B) shall be equal to 1.5 times
                  the Benchmark Share Price. Option B shall become exercisable
                  in 25% increments on each anniversary of the Issue Date (a
                  "B-Annual Tranche") so that Option B is fully exercisable on
                  the fourth anniversary of the Issue Date; provided, however,
                  at the first such time as the 30-Day Closing Price equals or
                  exceeds three times the Benchmark Share Price, the Paired
                  Shares subject to Option B shall accelerate and become
                  exercisable as to any Paired Shares not yet fully exercisable.

                            (iii) Upon the consummation of a Change in Control,
                  as defined herein,

                                    (1) the portion of each of Option A and B
                           that is not then exercisable shall become fully
                           vested and exercisable immediately prior to the
                           consummation of the Change in Control.

                           (v)  The Options shall have a term of 10 years.

         3.5 AUTOMOBILE ALLOWANCE. In lieu of an automobile furnished by the
Company, Executive shall receive an automobile allowance of $700 per month. All
gas, insurance, and maintenance will be at Executive's expense.

                                   ARTICLE IV

                                EXCLUSIVITY, ETC.

         4.1 EXCLUSIVITY. The Executive agrees to perform his duties,
responsibilities and obligations hereunder efficiently and to the best of his
ability. The Executive agrees that he will devote substantially all of his
working time, care and attention and best efforts to such duties,


                                      -4-

<PAGE>

responsibilities and obligations throughout the Term. The foregoing shall not be
interpreted to prohibit the Executive from serving as director or trustee of one
or more corporations or foundations (either for-profit or not-for-profit) other
than the Company. The Executive also agrees so long as he is employed by the
Company that he will not engage in any other business activities, pursued for
gain, profit or other pecuniary advantage, that are competitive with the
activities of the Company.

         4.2 OTHER BUSINESS VENTURES. The Executive agrees that, so long as he
is employed by the Company, he will not own, directly or indirectly, any
controlling or substantial stock or other beneficial interest in any business
enterprise which is engaged in, or competitive with, any business engaged in by
the Company. Notwithstanding the foregoing, the Executive may own, directly or
indirectly, up to 5% of the outstanding capital stock or any business having a
class of capital stock which is traded on any national stock exchange or in the
over-the-counter market.

         4.3 CONFIDENTIALITY. The Executive agrees that he will not, at any time
during or after the Term, make use of or divulge to any other person, firm or
corporation any trade or business secret, process, method or means, or any other
confidential information concerning the business or policies of the Company,
which he may have learned in connection with his employment hereunder. For
purposes of this Agreement, a "TRADE OR BUSINESS SECRET, PROCESS, METHOD OR
MEANS, OR ANY OTHER CONFIDENTIAL INFORMATION" shall mean and include written
information treated as both confidential and as a trade secret by the Company.
The Executive's obligation under this Section 4.3 shall not apply to any
information which (a) is known publicly; (b) is in the public domain or
hereafter enters the public domain without the fault of the Executive; (c) is
known to the Executive prior to his receipt of such information from the
Company, as evidenced by written records of the Executive; or (d) is hereafter
disclosed to the Executive by a third party not under an obligation of
confidence to the Company. The Executive agrees not to remove from the premises
of the Company, except as an employee of the Company in pursuit of the business
of the Company or except as specifically permitted in writing by the Company,
any document or other object containing or reflecting any such confidential
information. The Executive recognizes that all such documents and objects,
whether developed by him or by someone else, will be the sole and exclusive
property of the Company. Upon termination of his employment hereunder, the
Executive shall forthwith deliver to the Company all such confidential
information, including without limitation all lists of lessees, customers,
correspondence, accounts, records and any other documents or property made or
held by him or under his control in relation to the business or affairs of the
Company, and no copy of any such confidential information shall be retained by
him. The provisions of this Section 4.3 shall survive any termination of this
Agreement.

         4.4 NONCOMPETITION. During the period commencing on the date hereof and
ending on the first anniversary of the date on which the Executive's employment
is terminated, whether before or after the Term the Executive shall not,
directly or indirectly, whether as an employee, consultant, independent
contractor, partner, joint venturer or otherwise, (A) solicit or induce, or in
any manner attempt to solicit or induce, any person employed by, or as agent of,
the Company to terminate such person's employment or agency, as the case may be,
with the Company or (B) divert, or attempt to divert, any person, concern, or
entity from doing business with the Company (including entering into a lease),
nor will he attempt to induce any such person, concern or entity to cease being
a lessee, customer or supplier of the Company. If Executive is terminated by the
Company for other than


                                      -5-

<PAGE>

Cause or by the Executive for Good Reason, or after a Change of Control and
Executive Termination Event, the provisions of this Section 4.4 shall not be
binding on Executive.

                                    ARTICLE V

                                   TERMINATION

5.1  TERMINATION BY THE COMPANY.

                  (a) The Company shall have the right to terminate the
Executive's employment at any time with or without "Cause". For purposes of this
Agreement, "CAUSE" shall mean that, prior to any termination the Executive shall
have committed: (i) an act of fraud, embezzlement, theft, or any other act
constituting a felony, involving moral turpitude or causing material harm,
financial or otherwise, to the Company; (ii) a demonstrably intentional and
deliberate act or failure to act (other than as a result of incapacity due to
physical or mental illness) which is committed in bad faith by the Executive,
which causes or can be expected to cause material financial injury to the
Company; or (iii) an intentional and material breach of this Agreement that is
not cured by the Executive within 30 days after written notice from the Board of
Directors specifying the breach and requesting a cure. For purposes of this
Agreement, no act, or failure to act, on the part of the Executive shall be
deemed "intentional" if it was due primarily to an error in judgment or
negligence, but shall be deemed "intentional" only if done, or omitted to be
done, by the Executive not in good faith and without reasonable belief that his
action or omission was in, or not opposed to, the best interest of the Company.
Notwithstanding the foregoing, the Executive shall not be deemed to have been
terminated for "Cause" hereunder unless and until there shall have been
delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters of the Board then in office at
a meeting of the Board of Directors called and held for such purpose (after
reasonable notice to the Executive and an opportunity for the Executive,
together with his counsel, to be heard before the Board), finding that, in the
good faith opinion of the Board, the Executive had committed an act set forth
above and specifying the particulars thereof in detail. Nothing herein shall
limit the right of the Executive or his beneficiaries to contest the validity or
propriety of any such determination.

                  (b) The end of the Term, due to the exercise by the Company of
its non-renewal right under Section 2.1, shall also constitute termination by
the Company of Executive's employment.

         5.2 DEATH. In the event the Executive dies during the Term, this
Agreement shall automatically terminate, such termination to be effective on the
date of the Executive's death.

         5.3 DISABILITY. In the event that the Executive shall suffer a
disability which shall have prevented him from performing satisfactorily his
obligations hereunder for a period of at least 120 consecutive days, the Company
shall have the right to terminate this Agreement, such termination to be
effective upon the giving of notice thereof to the Executive in accordance with
this Agreement.


                                      -6-

<PAGE>

         5.4 TERMINATION BY THE EXECUTIVE FOR GOOD REASON. The Executive's
employment may be terminated during the Term by the Executive for Good Reason,
by giving to the Company 30 days advance written notice specifying the event or
circumstance which the Executive alleges constitutes Good Reason. Such notice of
resignation will take effect, if not revoked by the Executive, at the conclusion
of such thirty-day period. For purposes of this Agreement, the following
circumstances shall constitute "GOOD REASON" if not cured prior to the
expiration of such thirty-day period:

                  (a) the assignment to the Executive of duties that are
materially inconsistent with the Executive's position or with his authority,
duties or responsibilities as contemplated by Sections 1.1 and 1.2 of this
Agreement, or any other action by the Company or its successor which results in
a material diminution or material adverse change in such position, authority,
duties or responsibilities;

                  (b) any material breach by the Company or its successor of the
provisions of this Agreement; or

                  (c) the Company commences a voluntary case concerning itself
under Title 11 of the United States Code entitled "Bankruptcy", as now or
hereafter in effect, or any successor thereto (the "Bankruptcy Code"), or an
involuntary case commences against the Company and the petition is not dismissed
within (60) days after commencement of the case, or a custodian (as defined in
theBankruptcy Code) is appointed for, or takes charge of, all or substantially
all of the property of the Company, or the Company commences any other
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency, or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to the Company, or
there is commenced against the Company any such proceeding which remains
undismissed for a period of sixty (60) days, and the court administering such
case or proceeding fails to accept this Agreement within ninety(90) days of the
date upon which the court begins to administer such case or proceeding.

                  (d) a relocation of the Executive's principal base of
operation to any location which requires Executive to increase his daily inbound
commute by more than 45 miles.

         5.5      EFFECT OF TERMINATION.

                  (a) In the event of termination of the Executive's employment
for any reason or by reason of the Executive's death or disability, the Company
shall pay to the Executive (or his beneficiary in the event of his death) within
10 days after termination of employment any base salary, bonus or other
compensation earned but not paid to the Executive prior to the effective date of
such termination and, other than the circumstances of termination by the Company
for Cause or by the Executive voluntarily without Good Reason, the pro rata
amount of the annual cash bonus payable under the plan based on the Base Target
bonus for the year during which such termination occurs, based on the number of
days worked during such year.

                  (b) In the event of termination of the Executive's employment
(other than a termination following a Change of Control as hereafter defined and
provided for) (i) by the Company


                                      -7-

<PAGE>

other than for Cause or (ii) by the Executive for Good Reason, the Company shall
pay to the Executive, within 10 days after termination of employment in addition
to the amounts described in Section 5.5(a) hereof, a lump sum equal to two times
the sum of Executive's base salary and Base Target bonus. Further, 20% of the
original number of Performance Shares and the Options covering 20% of the
original number of Paired Shares in each Option shall accelerate and become
vested and exercisable in addition to any currently vested awards.

                  (c) In the event of the termination of the executive's
employment (other than a termination following a Change in Control as hereafter
defined and provided for) (i) by the Company other than for Cause, (ii) by the
Executive for Good Reason or (iii) on account of the Executive's death or
disability, for 24 months (or, if later, the date the Executive becomes eligible
for Medicare if his employment terminates on account of disability) following
the Termination Date, the Company shall arrange to provide the Executive with
health benefits (medical and dental) substantially similar to those which the
Executive was receiving or entitled to receive immediately prior to the
Termination Date. If and to the extent that such benefits shall not or cannot be
paid or provided under any policy, plan, program or arrangement of the Company
solely due to the fact that the Executive is no longer an officer or employee of
the Company, then the Company shall pay to the Executive, his dependents and
beneficiaries, the amount of premiums that would have been incurred by the
Company were the Company able to provide such coverage through its plan, program
or arrangement. Such health benefits shall be discontinued prior to the end of
the specified continuation period if the Executive receives comparable coverage
from a subsequent employer or becomes entitled to Medicare.

         5.6      TERMINATION FOLLOWING A CHANGE OF CONTROL.

                  (a) DEFINITIONS. As used herein, the following terms shall
have the following meanings:

                           (i) Change in Control. "Change in Control" shall mean

                                    (1) any transaction, or series of
                           transactions, including, but not limited to any
                           merger, consolidation, or reorganization, which
                           results when any "person" as defined in Section
                           3(a)(9) of the Exchange Act and as used in Sections
                           13(d) and 14(d) thereof, including a "group" as
                           defined in Section 13(d) of the Exchange Act, but
                           excluding the Company, any subsidiary of the Company,
                           and any employee benefit plan sponsored or maintained
                           by the Company or any subsidiary of the Company,
                           directly or indirectly, becomes the "beneficial
                           owner" (as defined in Rule 13d-3 under the Exchange
                           Act) of securities of the Company representing more
                           than 50% of the combined voting power of the
                           Company's then outstanding securities;

                                    (2) when, during any period of 24
                           consecutive months the individuals who, at the
                           beginning of such period, constitute the Board (the
                           "Incumbent Directors") cease for any reason other
                           than death to constitute at least a majority of the
                           Board; provided, however, that a director who was not


                                      -8-

<PAGE>

                           a director at the beginning of such 24-month period
                           shall be deemed to have satisfied such 24-month
                           requirement (and be an Incumbent Director) if such
                           director was elected by, or on the recommendation of
                           or with the approval of, at least two-thirds of the
                           directors who then qualified as Incumbent Directors
                           either actually (because they were directors at the
                           beginning of such 24-month period) or by prior
                           operation of this Section; or

                                    (3) when the stockholders of the Company
                           approve a plan of complete liquidation of the
                           Company; or an agreement for the sale or disposition
                           of substantially all the Company's assets other than
                           a sale of the Company's health care assets; or a
                           merger, consolidation, or reorganization of the
                           Company in which stockholders of the Company
                           immediately prior to the transaction own less than
                           50% of the combined voting power of the surviving
                           entity.

                           (ii) "Termination Date" shall mean the date on which
                  Executive's employment with the Company is terminated.

                  (b) TERMINATION BY COMPANY. Following a Change in Control, the
Executive's employment may be terminated by Company ("Company Termination
Event") and the Executive shall not be entitled to the severance benefits
provided under Section 5.7, provided that Executive's termination occurs as a
result of one or more of the following events:

                           (i)      The Executive's death;

                           (ii) The Executive's disability, provided Executive
                  actually begins to receive disability benefits pursuant to the
                  long-term disability plan in effect for senior executives of
                  the Company immediately prior to the Change in Control; or

                  (c) EXECUTIVE TERMINATION EVENT. If at any time during the two
year period commencing on the date of a Change in Control, the Company or
Executive terminates his employment following the occurrence of one or more of
the following events ("Executive Termination Event"), Executive shall be
entitled to the severance benefits provided in Section 5.7 below:

                           (i) Any termination by the Company of Executive's
                  employment during such two year period for any reason, other
                  than for Cause, as a result of Executive's death, or by reason
                  of the Executive's disability and the actual receipt of
                  disability benefits in accordance with a long-term disability
                  plan as may be maintained from time to time during the term by
                  the Company to the extent and in a manner available to other
                  Executive Officers of the Company.

                           (ii) Termination by the Executive of his employment
                  with the Company at any time within two years after the Change
                  in Control upon the occurrence of any of the following events:


                                      -9-

<PAGE>

                                    (1) The Company's failure to elect, re-elect
                           or otherwise maintain the Executive in the office or
                           position in the Company which the Executive held
                           immediately prior to a Change in Control.

                                    (2) A significant, adverse change (increase
                           or decrease) in the nature or scope of the
                           authorities, powers, functions, responsibilities or
                           duties attached to the position with the Company
                           which the Executive held immediately prior to the
                           Change in Control, or a reduction in the aggregate of
                           the Executive's base pay or annual incentive bonus
                           opportunity (and relative level of goal achievement)
                           in which the Executive participated immediately prior
                           to the Change in Control, or the termination of the
                           Executive's rights to any employee benefits to which
                           he was entitled immediately prior to the Change in
                           Control, or a reduction in scope or value of such
                           benefits, without prior written consent of the
                           Executive, any of which is not remedied within 10
                           calendar days after receipt by the Company of a
                           written notice from the Executive of such change,
                           reduction, or termination, as the case may be;

                                    (3) The Company or its successor becomes a
                           subsidiary of another company and the Executive is
                           not the Chief Financial Officer of the ultimate
                           parent company;

                                    (4) The Company shall relocate its principal
                           executive offices, or require the Executive to have
                           his principal location of work changed, to any
                           location which is in excess of 45 miles from the
                           location thereof immediately prior to the Change in
                           Control; or

                                    (5) The liquidation, dissolution, merger,
                           consolidation, or reorganization of the Company or
                           transfer of all or a significant portion of its
                           business and/or assets (excluding the healthcare
                           assets of the Company); or

                                    (6) Without limiting the generality or
                           effect of the foregoing, any material breach of this
                           Agreement by the Company or any successor thereto

         5.7 SEVERANCE BENEFITS. In the event Executive's employment is
terminated within two years of the date of a Change in Control as a result of an
Executive Termination Event, Executive shall be entitled to the benefits set
forth below. All amounts payable under this Section 5.7(a) (b) (c) and (d) shall
be paid to Executive in one lump sum within 45 days after his termination of
employment.

                  (a) The Company shall pay to Executive an amount equal to
three times the average of his annual base salary for the three fiscal years (or
such fewer fiscal years that Executive is actually employed by the Company)
preceding the Change in Control ["average Base Salary"] and three times the
greater of i) the average of his cash bonuses paid with respect to the last two
fiscal


                                      -10-

<PAGE>

years (or such fewer fiscal years that Executive is actually employed by the
Company) preceding the Change in Control, or ii) Base Target Bonus.

                  (b) The Company shall pay Executive his full base salary
through Executive's Termination Date. The Company shall also pay Executive an
amount equal to the pro rata amount of the Target bonus award available to the
Executive under the bonus plan during the year of termination, based on the
number of days of the year elapsed prior to the Termination Date.

                  (c) All unvested equity, including Performance Shares and the
Options, and retirement benefits (such as 401k) shall become fully vested and
exercisable.

                  (d) The Company will provide outplacement assistance from a
service selected by the Executive for a period of one year from the Termination
Date. All associated costs will be paid by the Company, up to a maximum of
thirty percent (30%) of Executive's average Base Salary.

                  (e) The Executive may elect, within 120 calendar days
following the Termination Date, to have the Company purchase the Executive's
house at its then current market value (which shall be established by taking the
average of three appraisals from real estate firms, one selected by the
Executive, one selected by the Company, and one selected by the two selected
firms, with the Company paying the costs of the appraisals). Such purchase shall
occur on a date mutually agreed to by Executive and Company but in any event
within six months following the Executive's election to have the house purchased
by the Company.

                  (f) For a period of three years following Executive's
termination of employment the Company shall arrange to provide the Executive
with health benefits (medical and dental) substantially similar to those which
the Executive was receiving or entitled to receive immediately prior to the
Termination Date. If and to the extent that such benefits shall not or cannot be
paid or provided under any policy, plan, program or arrangement of the Company
solely due to the fact that the Executive is no longer an officer or employee of
the Company, then the Company shall pay to the Executive, his dependents and
beneficiaries, the amount of premiums that would have been incurred by the
Company were the Company able to provide such coverage through its plan, program
or arrangement. Such health benefits shall be discontinued prior to the end of
the specified continuation period if the Executive receives comparable coverage
from a subsequent employer or becomes entitled to Medicare.

         5.8 OTHER RIGHTS. A termination of the Executive's employment by the
Company pursuant to this Agreement or by the Executive shall not affect
adversely any rights which the Executive may have pursuant to any agreement,
employment contract, policy, plan, program or arrangement of the Company
providing employee benefits, which rights shall be governed by the terms of such
employee benefit plan.

                                   ARTICLE VI

                                 INDEMNIFICATION


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<PAGE>

         The Company will indemnify the Executive to the fullest extent that
would be permitted by law (including a payment of expenses in advance of final
disposition of a proceeding) as in effect at the time of the subject act or
omission, or by the charter or by-laws of the Company as in effect at such time,
or by the terms of any indemnification agreement between the Company and the
Executive, whichever affords greatest protection to the Executive, and the
Executive shall be entitled to the protection of any insurance policies the
Company may elect to maintain generally for the benefit of its officers or,
during the Executive's service in such capacity, directors (and to the extent
the Company maintains such an insurance policy or policies, in accordance with
its or their terms to the maximum extent of the coverage available for any
company officer or director); against all costs, charges and expenses whatsoever
incurred or sustained by the Executive (including but not limited to any
judgment entered by a court of law) at the time such costs, charges and expenses
are incurred or sustained, in connection with any action, suit or proceeding to
which the Executive may be made a party by reason of his being or having been an
officer or employee of the Company, or serving as a director, officer or
employee of an affiliate of the Company, at the request of the Company, other
than any action, suit or proceeding brought against the Executive by or on
account of his breach of the provisions of an employment agreement with a third
party that has not been disclosed by the Executive to the Company. The
provisions of this Article 6 shall survive any termination of this Agreement.

                                   ARTICLE VII

                    TAXES AND MISCELLANEOUS OTHER PROVISIONS

         7.1 TAX CONSIDERATIONS. Notwithstanding anything herein to the
contrary, in the event any payments or benefits provided to Executive hereunder
are determined by the Company to be subject to the tax imposed by Section 4999
of the Code or any similar federal or state excise tax, FICA tax, or any
interest or penalties are incurred by the Executive with respect to such excise
tax (such excise tax, together with any such interest and penalties are
hereinafter collectively referred to as the "Excise Tax"), Company shall pay to
Executive at the time specified in Section 5.5 (b) or 5.7 above (whichever
applies), an additional amount (the "Gross-Up Payment") such that after the
payment by Executive of all federal, state, or local income taxes, Excise Taxes,
FICA tax, or other taxes (including any interest or penalties imposed with
respect thereto) imposed upon the receipt of the Gross-Up Payment, Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed on the
severance payments and benefits provided herein.

                  (a) For purposes of determining whether any payments or
benefits to Executive hereunder will be subject to the Excise Tax and the amount
of such Excise Tax:

                           (i) all payments or benefits received or to be
                  received by Executive in connection with a Change in Control
                  or the termination of employment (whether pursuant to the
                  terms of this Agreement or of any other plan, arrangement or
                  agreement with Company) shall be treated as "parachute
                  payments" within the meaning of Section 280G(b)(2) of the
                  Code, and all "excess parachute payments" within the meaning
                  of Section 280G(b)(1) shall be treated as subject to the
                  Excise Tax, unless in the opinion of tax counsel selected by
                  Company and acceptable to


                                      -12-
<PAGE>

                  Executive, such payments or benefits (in whole or in part)
                  do not constitute parachute payments under Section 280G of
                  the Code, or such excess parachute payments (in whole or in
                  part) represent reasonable compensation for services
                  actually rendered within the meaning of Section 280G(b)(4)
                  of the Code;

                           (ii) the amount of the severance payments which shall
                  be treated as subject to the Excise Tax shall be equal to the
                  amount of excess parachute payments within the meaning of
                  Sections 280G(b)(1) and (4) (after applying clause (a),
                  above); and

                           (iii) the parachute value of any noncash benefits or
                  any deferred payment or benefit shall be determined by Company
                  in accordance with the principles of Sections 280G(d)(3) and
                  (4) of the Code.

                  (b) If the Excise Tax is subsequently determined to be less
than the amount taken into account hereunder at the time of termination of
employment, Executive shall repay to Company, at the time the reduction in
Excise Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction. If the Excise Tax is determined to exceed the
amount taken into account hereunder at the time of termination of employment,
Company shall make an additional Gross-Up Payment to Executive in respect of
such excess at the time the amount of such excess is finally determined. The
Executive shall notify the Company in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by the Company of
the Gross-Up Payment. Such notification shall be given as soon as practicable
but no later that ten business days after the Executive is informed in writing
of such claim and shall apprise the Company of the nature of such claim and the
date on which such claim is requested to be paid. The Executive shall not pay
such claim prior to the expiration of the 30 calendar day period following the
date on which it gives such notice to the Company (or such shorter period ending
on the date that any payment of taxes with respect to such claim is due). If the
Company notifies the Executive in writing prior to the expiration of such period
that it desires to contest such claim, the Executive shall:

                           (i)  give the Company any information reasonably
                  requested by the Company relating to such claim,

                           (ii) take such action in connection with contesting
                  such claim as the Company shall reasonably request in writing
                  from time to time, including, without limitation, accepting
                  legal representation with respect to such claim by an attorney
                  reasonably selected by the Company,

                           (iii) cooperate with the Company in good faith in
                  order to effectively contest such claim, and

                           (iv)  permit the Company to participate in any
                  proceedings relating to such claim;


                                      -13-

<PAGE>

provided, however, that the Company shall bear and pay directly all costs and
expenses (including legal and accounting fees and additional interest and
penalties) incurred in connection with such contest and shall indemnify and hold
the Executive harmless, on an after-tax basis, for any Excise Tax, FICA tax or
income tax (including interest and penalties with respect thereto) imposed as a
result of such representation and payment of costs and expenses. Without
limitation on the foregoing provisions of this section, the Company shall
control all proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim and
may, at its sole option, either direct the Executive to pay the tax claimed and
sue for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided, however, that if the
Company directs the Executive to pay such claim and sue for a refund, the
Company shall advance the amount of such payment to the Executive, on an
interest-free basis, and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax (including interest or
penalties with respect thereto) imposed with respect to such advance or with
respect to any imputed income with respect to such advance; and further provided
that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Company's control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing authority.

         If any such claim referred to in this Section is made by the Internal
Revenue Service and the Company does not request the Executive to contest the
claim within the 30 calendar day period following notice of the claim, the
Company shall pay to the Executive the amount of any Gross-Up Payment owed to
the Executive, but not previously paid pursuant to Section 7.1(b), immediately
upon the expiration of such 30 calendar day period. If any such claim is made by
the Internal Revenue Service and the Company requests the Executive to contest
such claim, but does not advance the amount of such claim to the Executive for
purposes of such contest, the Company shall pay to the Executive the amount of
any Gross-Up Payment owed to the Executive, but not previously paid under the
provisions of Section 7.1(b), within 5 business days of a Final Determination of
the liability of the Executive for such Excise Tax. For purposes of this
Agreement, a "Final Determination" shall be deemed to occur with respect to a
claim when (i) there is a decision, judgment, decree or other order by any court
of competent jurisdiction, which decision, judgment, decree or other order has
become final, i.e., all allowable appeals pursuant to this section have been
exhausted by either party to the action, (ii) there is a closing agreement made
under Section 7121 of the Code, or (iii) the time for instituting a claim for
refund has expired, or if a claim was filed, the time for instituting suit with
respect thereto has expired.

         If, after the receipt by the Executive of an amount advanced by the
Company pursuant to this section, the Executive becomes entitled to receive any
refund with respect to such claim, the Executive shall (subject to the Company's
complying with the requirements of this section) promptly pay to the Company the
amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by the Executive of an amount
advanced by the


                                      -14-
<PAGE>

Company pursuant to this section, a determination is made by the Internal
Revenue Service that the Executive is not entitled to any refund with respect to
such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 calendar
days after such determination, then such advance shall be forgiven and shall not
be required to be repaid and the amount of such advance shall offset, to the
extent thereof, the amount of Gross-Up Payment required to be paid.

         7.2 NO SET-OFF. There shall be no set-off or counterclaim against, or
delay in, any payment of severance benefits by the Company to Executive provided
for in this Agreement with respect to any claim against or debt or obligation of
Executive, whether arising hereunder or otherwise except for health benefits as
provided in Sections 5.5(c) or 5.7(f).

         7.3 NO MITIGATION OBLIGATION. Executive's benefits hereunder shall be
payable to him as severance pay in consideration of his services under this
Agreement. The Company hereby acknowledges that it will be difficult, and may be
impossible, for the Executive to find reasonably comparable employment following
the Termination Date. Accordingly, the parties hereto expressly agree that the
payment of the severance benefits by the Company to the Executive in accordance
with the terms of this Agreement will be liquidated damages, and that the
Executive shall not be required to mitigate the amount of any payment provided
for in this Agreement by seeking other employment or otherwise, nor shall any
profits, income, earnings or other benefits from any source whatever create any
mitigation, offset, reduction or any other obligation on the part of the
Executive hereunder or otherwise.

         7.4 ENFORCEMENT COSTS. Company is aware that, upon the occurrence of a
Change in Control, the Board of Directors or a shareholder of the Company, or
the Company's successor in interest, may then cause or attempt to cause Company
to refuse to comply with its obligations under this Agreement, or may cause or
attempt to cause Company to institute, or may institute litigation seeking to
have this Agreement declared unenforceable, or may take, or attempt to take,
other action to deny Executive the benefits intended under this Agreement. In
these circumstances, the purpose of this Agreement could be frustrated. It is
the intent of Company that Executive not be required to incur the expenses
associated with the enforcement of his rights under this Agreement by litigation
or other legal action, nor be bound to negotiate any settlement of his rights
hereunder under threat of incurring such expenses because the cost and expense
thereof would substantially detract from the benefits intended to be extended to
Executive hereunder. Accordingly, if following a Change in Control Executive
should conclude in good faith that Company has failed to comply with any of its
obligations under this Agreement or in the event that Company or any other
person takes any action to declare this Agreement void or unenforceable, or
institutes any litigation or other legal action designed to deny, diminish or to
recover from Executive the benefits intended to be provided to Executive
hereunder, Company irrevocably authorizes Executive from time to time to retain
legal counsel of his choice at the expense of Company to represent Executive in
connection with the initiation or defense of any litigation or other legal
action, whether by or against Company or any director, officer, stockholder or
other person affiliated with Company. The reasonable fees and expenses of
counsel selected from time to time by Executive as provided herein shall be paid
or reimbursed to Executive by Company on a regular, periodic basis upon
presentation by Executive of a statement or statements prepared by his counsel
in accordance with its customary practices. In


                                      -15-

<PAGE>

any action involving this Agreement, Executive shall be entitled to prejudgment
interest on any amounts found to be due him as of the date such amounts would
have been payable to Executive pursuant to this Agreement at an annual rate of
interest of 10%.

         7.5 ARBITRATION. The Company and Executive hereby agree that certain
issues and/or disagreements arising in connection with this Agreement shall be
settled by arbitration. Accordingly, in the event the Company or Executive
believes that the other party has violated any provision of this Agreement,
including but not limited to any action by the Company which Executive believes
would entitle Executive to terminate his employment with severance benefits in
accordance with Article 5 hereof, the party alleging such violation shall notify
the other party in writing of such alleged violation. In the event the party
receiving such violation notice disagrees with the position taken by the other
party in such written notice, the recipient of the violation notice may, within
20 days of receipt of such written notice, notify the other party, in writing,
that it has elected to submit such disagreement to arbitration. Arbitration of
such dispute shall be settled in Dallas, Texas, in accordance with the then
applicable rules of the American Arbitration Association. The Company shall bear
all costs associated with such arbitration. In the event the party receiving a
violation notice does not elect to submit any issue or disagreement to
arbitration within 10 days of its receipt of the written violation notice, such
party will be deemed to have accepted the position taken in such written notice.
Notwithstanding anything herein to the contrary, neither the Company nor the
Executive shall be required to arbitrate the basis of any involuntary
termination of Executive's employment with the Company by the Company or its
successor.

         7.6 EMPLOYMENT RIGHTS. Nothing expressed or implied in this Agreement
shall create any right or duty on the part of the Company or the Executive to
have the Executive remain in the employment of the Company prior to any Change
in Control, provided, however, that any event which would constitute an
Executive Termination Event had a Change in Control occurred following the
commencement of active negotiations with a third party (which negotiations are
evidenced by the delivery of evaluation material) that ultimately results in a
Change in Control shall be deemed to be a termination or removal of the
Executive by the Company other than for Cause after a Change in Control for
purposes of this Agreement.

         7.7 BENEFIT OF AGREEMENT; ASSIGNMENT; BENEFICIARY. This Agreement shall
inure to the benefit of and be binding upon the Company and its successors and
assigns, including, without limitation, any corporation or person which may
acquire all or substantially all of the Company's assets or business, or with or
into which the Company may be consolidated or merged. This Agreement shall also
inure to the benefit of, and be enforceable by, the Executive and his personal
or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive should die while any
amount would still be payable to the Executive hereunder if he had continued to
live, all such amounts shall be paid in accordance with the terms of this
Agreement to the Executive's beneficiary, devisee, legatee or other designee, or
if there is no such designee, to the Executive's estate.

         7.8 NOTICES. Any notice required or permitted hereunder shall be in
writing and shall be sufficiently given if personally delivered or if sent by
telegram or telex or by registered or certified mail, postage prepaid, with
return receipt requested, addressed:


                                      -16-

<PAGE>

                  (a)  in the case of the Company, Meditrust Corporation, 909
Hidden Ridge, Suite 600, Irving, Texas 75038, Attention: General Counsel; and

                  (b) in the case of the Executive, to David L. Rea, 4868
Avondale Ridge, Dublin, Ohio 43017, or such other address as the Executive may
specify in writing to the Company.

         7.9 ENTIRE AGREEMENT; AMENDMENT. This Agreement contains the entire
agreement of the parties hereto with respect to the terms and conditions of the
Executive's employment during the Term and supersedes any and all prior
agreements and understandings, whether written or oral, between the parties
hereto with respect to compensation due for services rendered hereunder. This
Agreement may not be changed or modified except by an instrument in writing
signed by both of the parties hereto.

         7.10 WAIVER. The waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed as a continuing waiver or as a
consent to or waiver of any subsequent breach hereof.

         7.11 HEADINGS. The article and section headings herein are for
convenience of reference only, do not constitute a part of this Agreement and
shall not be deemed to limit or affect any of the provisions hereof.

         7.12 GOVERNING LAW. This Agreement shall be governed by, and construed
and interpreted in accordance with, the internal laws of the State of Texas
without reference to the principles of conflict of laws.

         7.13 AGREEMENT TO TAKE ACTIONS. Each party hereto shall execute and
deliver such documents, certificates, agreements and other instruments, and
shall take such other actions, as may be reasonably necessary or desirable in
order to perform his or its obligations under this Agreement or to effectuate
the purposes hereof.

         7.14 SURVIVORSHIP. The respective rights and obligations of the parties
hereunder shall survive any termination of this Agreement to the extent
necessary to the intended preservation of the rights and obligations under this
Agreement.

         7.15 SEVERABILITY. The invalidity or unenforceability of any provision
or provisions of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement, which shall remain in full force and
effect.

         7.16 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

         7.17 CORPORATE AUTHORIZATION. The Company hereby represents that the
execution, delivery and performance by the Company of this Agreement are within
the corporate powers of the

                                      -17-

<PAGE>

Company, and that the President and Chief Executive Officer has the requisite
authority to bind the Company hereby.

         7.18 THIRD PARTY AGREEMENTS AND RIGHTS. The Executive represents to the
Company that the Executive's execution of this Agreement, the Executive's
employment with the Company and the performance of Executive's proposed duties
for the Company will not violate any obligations the Executive may have to any
employer, former employer or other party, and Executive does not possess
tangible embodiments of non-public information belonging to or obtained from any
such previous employment or other party. Further, the Executive represents and
acknowledges that to the extent that he is under any continuing obligation under
any agreement with any employer, former employer or other party with regard to
non-solicitation, non-inducement and confidentiality, he shall not violate any
such obligation.

         7.19 LITIGATION AND REGULATORY COOPERATION. During and after
Executive's employment, Executive shall reasonably cooperate with the Company in
the defense or prosecution of any claims or actions now in existence or which
may be brought in the future against or on behalf of the Company which relate to
events or occurrences that transpired while Executive was employed by the
Company; provided, however, that such cooperation shall not materially and
adversely affect Executive or expose Executive to an increased probability of
civil or criminal litigation. Executive's cooperation in connection with such
claims or actions shall include, but not be limited to, being available to meet
with counsel to prepare for discovery or trial and to act as a witness on behalf
of the Company at mutually convenient times. During and after Executive's
employment, Executive also shall cooperate fully with the Company in connection
with any investigation or review of any federal, state or local regulatory
authority as any such investigation or review relates to events or occurrences
that transpired while Executive was employed by the Company. The Company shall
also provide Executive with compensation on an hourly basis (to be derived from
his base compensation) for requested litigation and regulatory cooperation that
occurs after his termination of employment, and reimburse Executive for all
costs and expenses incurred in connection with his performance under this
Section 7.19, including, but not limited to, reasonable attorneys' fees and
costs.



                                      -18-

<PAGE>


     IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date first above written.


                               MEDITRUST CORPORATION

                               By: __________________________________________
                                      President and Chief Executive Officer


                               EXECUTIVE

                               ______________________________________________
                                                David L. Rea






                                      -19-