MEDITRUST OPERATING CO, DEF 14A, 2000-06-13

MEDITRUST OPERATING CO
DEF 14A, 2000-06-13
REAL ESTATE INVESTMENT TRUSTS

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<PAGE>
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a party other than the Registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-12

MEDITRUST CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/X/ No fee required.

/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.

(1) Title of each class of securities to which transaction applies:

------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:

------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):

------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:

------------------------------------------------------------------------
(5) Total fee paid:

------------------------------------------------------------------------

/ / Fee paid previously with preliminary materials.

/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:

------------------------------------------------------------------------
(3) Filing Party:

------------------------------------------------------------------------
(4) Date Filed:

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<PAGE>
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a party other than the Registrant / /

MEDITRUST OPERATING COMPANY
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/x/ No fee required.

/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.

(1) Title of each class of securities to which transaction applies:

------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:

------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:

------------------------------------------------------------------------
(5) Total fee paid:

------------------------------------------------------------------------

/ / Fee paid previously with preliminary materials.

(1) Amount Previously Paid:

------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:

------------------------------------------------------------------------
(3) Filing Party:

------------------------------------------------------------------------
(4) Date Filed:

------------------------------------------------------------------------

<PAGE>
MEDITRUST CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JULY 20, 2000

The Annual Meeting of Shareholders of Meditrust Corporation ("Meditrust")
will be held at the Traders Room, World Trade Center, 2050 Stemmons Freeway,
Dallas, Texas, 75207 on Thursday, July 20, 2000 at 9:00 a.m. local time
(together with all adjournments and postponements thereof, the "Meditrust
Meeting"), for the following purposes:

1. To consider and act upon a proposal to elect two Directors of Meditrust,
each to serve for a term of three years and until his successor is duly elected
and qualified.

2. To consider and act upon such other business and matters or proposals as
may properly come before the Meditrust Meeting.

The Board of Directors of Meditrust has fixed the close of business on
June 8, 2000 as the record date for determining the shareholders having the
right to receive notice of and to vote at the Meditrust Meeting. Only
shareholders of record at the close of business on such date are entitled to
notice of and to vote at the Meditrust Meeting. A list of shareholders entitled
to vote at the Meditrust Meeting will be available during ordinary business
hours at Meditrust's executive offices, 909 Hidden Ridge Road, Suite 600,
Irving, Texas 95038 for ten days prior to the Meditrust Meeting, for examination
by any Meditrust shareholder for purposes germane to the Meditrust Meeting.

By Order of the Board of Directors of
MEDITRUST CORPORATION

/s/ Michael S. Benjamin

Michael S. Benjamin
Secretary

Irving, Texas
June 9, 2000

WHETHER OR NOT YOU PLAN TO ATTEND THE MEDITRUST MEETING, YOU ARE REQUESTED TO
SIGN, DATE AND MAIL PROMPTLY THE ENCLOSED PROXY WHICH IS BEING SOLICITED ON
BEHALF OF THE BOARD OF DIRECTORS. A RETURN ENVELOPE WHICH REQUIRES NO POSTAGE IF
MAILED IN THE UNITED STATES IS ENCLOSED FOR THAT PURPOSE. RETURNING THE ENCLOSED
PROXY WILL NOT AFFECT YOUR RIGHT TO ATTEND THE MEDITRUST MEETING AND VOTE YOUR
SHARES IN PERSON.
<PAGE>
MEDITRUST OPERATING COMPANY
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JULY 20, 2000

The Annual Meeting of Shareholders of Meditrust Operating Company
("Operating Company") will be held at the Traders Room, World Trade Center, 2050
Stemmons Freeway, Dallas, Texas, 75207 on Thursday, July 20, 2000 at 9:15 a.m.
local time (together with all adjournments and postponements thereof, the
"Operating Company Meeting"), for the following purposes:

1. To consider and act upon a proposal to elect two Directors of Operating
Company, each to serve for a term of three years and until his successor is duly
elected and qualified.

2. To consider and act upon such other business and matters or proposals as
may properly come before the Operating Company Meeting.

The Board of Directors of Operating Company has fixed the close of business
on June 8, 2000 as the record date for determining the shareholders having the
right to receive notice of and to vote at the Operating Company Meeting. Only
shareholders of record at the close of business on such date are entitled to
notice of and to vote at the Operating Company Meeting. A list of shareholders
entitled to vote at the Operating Company Meeting will be available during
ordinary business hours at Operating Company's executive offices, 909 Hidden
Ridge Road, Suite 600, Irving, Texas 95038, for ten days prior to the Operating
Company Meeting, for examination by any Operating Company shareholder for
purposes germane to the Operating Company Meeting.

By Order of the Board of Directors of
MEDITRUST OPERATING COMPANY

/s/ Gilbert G. Menna

Gilbert G. Menna
Secretary

Irving, Texas
June 9, 2000

WHETHER OR NOT YOU PLAN TO ATTEND THE OPERATING COMPANY MEETING, YOU ARE
REQUESTED TO SIGN, DATE AND MAIL PROMPTLY THE ENCLOSED PROXY WHICH IS BEING
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. A RETURN ENVELOPE WHICH REQUIRES
NO POSTAGE IF MAILED IN THE UNITED STATES IS ENCLOSED FOR THAT PURPOSE.
RETURNING THE ENCLOSED PROXY WILL NOT AFFECT YOUR RIGHT TO ATTEND THE OPERATING
COMPANY MEETING AND VOTE YOUR SHARES IN PERSON.
<PAGE>
THE MEDITRUST AND OPERATING COMPANY ANNUAL MEETINGS

This Joint Proxy Statement is furnished in connection with the solicitation
by and on behalf of the Boards of Directors of Meditrust Corporation, a Delaware
corporation ("Meditrust") and Meditrust Operating Company, a Delaware
corporation ("Operating Company," together with Meditrust, "The Meditrust
Companies" and each a "Company"), of proxies from holders of Meditrust and
Operating Company common stock, which shares are paired and traded as a single
unit on the New York Stock Exchange (the "Paired Shares"), for use at the
Meditrust Meeting and Operating Company Meeting (as each is defined below). This
Joint Proxy Statement and the accompanying forms of proxy are expected to be
mailed to the respective shareholders of The Meditrust Companies on or about
June 13, 2000.

PURPOSE OF THE ANNUAL MEETINGS

MEDITRUST

At the annual meeting of shareholders of Meditrust to be held at the Traders
Room, World Trade Center, 2050 Stemmons Freeway, Dallas, Texas, 75207, on
Thursday, July 20, 2000 at 9:00 a.m. local time (together with all adjournments
and postponements thereof, the "Meditrust Meeting"), holders of Meditrust common
stock, par value $.10 per share ("Meditrust Common Stock") will consider and
vote upon:

1. A proposal to elect two Directors of Meditrust, each to serve for a term
of three years and until his successor is duly elected and qualified.

2. Such other business and matters or proposals as may properly come before
the Meditrust Meeting.

OPERATING COMPANY

At the annual meeting of shareholders of Operating Company to be held at the
Traders Room, World Trade Center, 2050 Stemmons Freeway, Dallas, Texas, 75207,
on Thursday, July 20, 2000 at 9:15 a.m. local time (together with all
adjournments and postponements thereof, the "Operating Company Meeting"),
holders of Operating Company common stock, par value $.10 per share ("Operating
Company Common Stock") will consider and vote upon:

1. A proposal to elect two Directors of Operating Company, each to serve for
a term of three years and until his successor is duly elected and qualified.

2. Such other business and matters or proposals as may properly come before
the Operating Company Meeting.

RECORD DATE; VOTING RIGHTS; REVOCATION OF PROXIES

The Meditrust Companies have fixed the close of business on June 8, 2000 as
the record date ("The Meditrust Companies Record Date") for determining holders
of Paired Shares entitled to notice of and to vote at the Meditrust Meeting and
the Operating Company Meeting (collectively, the "Companies Meetings"). Each
Paired Share entitles the holder to one vote per share on each matter submitted
to the respective Company's shareholders. Only holders of Paired Shares at the
close of business on The Meditrust Companies Record Date will be entitled to
notice of and to vote at the Companies Meetings. As of The Meditrust Companies
Record Date, there were outstanding and

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<PAGE>
entitled to vote 141,762,543 Paired Shares. Paired Shares held in the treasury
of Meditrust or Operating Company are not considered outstanding.

All Paired Shares which are entitled to vote and are represented at the
Companies' Meetings by properly executed proxies received prior to or at the
respective meeting will be voted at the meeting in accordance with the
instructions indicated on the proxies. IF NO INSTRUCTIONS ARE GIVEN ON A PROXY
CARD, IT WILL BE VOTED FOR APPROVAL AND ADOPTION OF THE RESPECTIVE PROPOSALS SET
FORTH THEREON. If any other matters are properly presented at the Companies'
Meetings for consideration, including, among other things, consideration of a
motion to adjourn such meeting to another time and/or place, the persons named
in the enclosed forms of proxy will have discretion to vote on such matters in
accordance with their best judgment. However, proxies voted against the
proposals will not be voted in favor of adjournment in order to continue to
solicit proxies. Pursuant to the respective By-laws of each of The Meditrust
Companies, no notice of an adjourned meeting need be given other than
announcement at the respective meeting, except where the meeting is adjourned
for 30 days or more.

A shareholder who has given a proxy may revoke it at any time before it is
exercised by giving written notice to the Secretary of Meditrust or Operating
Company, as the case may be, by signing and returning a later dated proxy, or by
voting in person at the Meditrust Meeting or Operating Company Meeting, as the
case may be; however, mere attendance at the Meditrust Meeting or the Operating
Company Meeting will not in and of itself have the effect of revoking the proxy.

SOLICITATION OF PROXIES

Meditrust and Operating Company will bear equally the costs of solicitation
of proxies and of preparing, printing and mailing this Joint Proxy Statement.
Brokerage houses, fiduciaries, nominees and others will be reimbursed for their
out-of-pocket expenses in forwarding proxy materials to beneficial owners of
Paired Shares held in their names. In addition to the solicitation of proxies by
use of the mails, proxies may be solicited from holders of Paired Shares by
Directors, officers and employees of The Meditrust Companies in person or by
telephone, telegraph, facsimile or other appropriate means of communications. No
additional compensation, except for reimbursement of reasonable out-of-pocket
expenses, will be paid to these Directors, officers and employees of The
Meditrust Companies in connection with the solicitation. In addition, D.F.
King & Co., Inc., a proxy solicitation firm, has been engaged by The Meditrust
Companies to act as proxy solicitor and will receive fees estimated at $5,000
plus reimbursement of out-of-pocket expenses.

QUORUM

The holders of a majority of the common stock outstanding and entitled to
vote, present in person or represented by proxy, shall constitute a quorum at
each of the Companies Meetings. Votes cast in person or by proxy at the
Meditrust Meeting and the Operating Company Meeting will be tabulated by the
inspector of elections appointed for each respective meeting and will determine
whether or not a quorum is present. The inspector of elections will treat
abstentions as shares that are present and entitled to vote for purposes of
determining the presence of a quorum, but as unvoted for purposes of determining
the approval of any matter submitted to the shareholders for a vote. If a broker
indicates on the proxy that it does not have discretionary authority as to
certain shares to vote on a particular matter, those shares will be considered
as present but not entitled to vote with respect to that matter.

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<PAGE>
PRINCIPAL AND MANAGEMENT SHAREHOLDERS OF THE MEDITRUST COMPANIES

The following table sets forth as of May 1, 2000, except as otherwise noted,
the number of Paired Shares beneficially owned, directly or indirectly, by
(i) each of the Directors of each of The Meditrust Companies, (ii) all persons
who served as chief executive officer of either of The Meditrust Companies for
the year ended December 31, 1999, (iii) each of the four most highly compensated
executive officers for the year ended December 31, 1999, (iv) all Directors and
current executive officers of The Meditrust Companies as a group, and (v) all
persons who, to the knowledge of The Meditrust Companies, beneficially own five
percent or more of the Paired Shares as of May 1, 2000. Unless otherwise
indicated, all information concerning beneficial ownership was provided by the
respective Director, executive officer or five percent beneficial owner, as the
case may be.

<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS
------------------------ ----------------------- ---------------------
<S> <C> <C>
DIRECTORS AND EXECUTIVE OFFICERS:
William C. Baker........................................... 101,400 *
Clive D. Bode.............................................. 25,000 *
Edward W. Brooke........................................... 195,963(2) *
William G. Byrnes.......................................... 120,182 *
Francis W. Cash............................................ -0- *
James P. Conn.............................................. 42,347 *
John C. Cushman, III....................................... 295,980 *
Stephen E. Merrill......................................... 2,000 *
Michael S. Benjamin........................................ 215,761(3) *
Michael F. Bushee.......................................... 217,412(3) *
Laurie T. Gerber........................................... 78,697(3) *
---------- ---------------------
All Directors and current executive officers of The
Meditrust Companies as a group............................ 1,246,782(4) *

5% Shareholders:

Sid R. Bass, Inc........................................... 2,712,067(5)
Lee M. Bass, Inc........................................... 2,712,067(6)
The Bass Management Trust.................................. 3,014,164(7)
The Airlie Group, L.P...................................... 269,633(8)(9)
William P. Hallman, Jr..................................... 300,002(10)
Annie R. Bass Grandson's Trust for Lee M. Bass............. 527,188(11)
Annie R. Bass Grandson's Trust for Sid R. Bass............. 527,188(12)
Peter Sterling............................................. 337,600(13)
Hyatt Anne Bass Successor Trust............................ 1,013,918(14)
Samantha Sims Bass Successor Trust......................... 1,013,918(15)
TF Investors, L.P.......................................... 32,783(16)
FW Trinity Limited Investors, L.P.......................... 419,398(17)
National Bancorp of Alaska................................. 113,045(18)
---------- ---------------------
Total...................................................... 12,992,971 9.2%
========== =====================
Merrill Lynch & Co., Inc................................... 14,262,221(19) 10.1%
</TABLE>

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<PAGE>
------------------------

* Denotes less than 1%.

(1) Unless otherwise indicated, the number of Paired Shares stated as being
owned beneficially includes (i) Paired Shares beneficially owned by spouses,
minor children and/or other relatives in which the Director or officer may
share voting power and (ii) any of the Paired Shares listed as being subject
to options exercisable within sixty days of May 1, 2000.

(2) Does not include 1,201 Paired Shares owned by Senator Brooke's wife's IRA,
or 6000 Paired Shares owned of record by Senator Brooke as custodian for his
son, as to which Paired Shares Senator Brooke disclaims any beneficial
interest. Senator Brooke, whose terms expire at the 2000 annual meetings, is
not seeking re-election to the Board of Directors of the Meditrust
Companies.

(3) Does not include 90,000 Shares of restricted stock issued to each of
Messrs. Benjamin and Bushee and Ms. Gerber in 1998, 1999 and 2000. The
restricted stock vests on the earlier of the 8th year or upon achievement of
the following performance criteria: achievement of Funds from Operations of
$2.92 in 2000, $3.10 in 2001, $3.28 in 2002, $3.48 in 2003 and $3.69 in
2004. None of these vesting requirements will be met within 60 days. All of
the restricted stock immediately vests upon a change of control of
Meditrust.

(4) Does not include an aggregate of 8,701 Paired Shares owned by or for
parents, spouses or children, as to which Paired Shares the Directors or
officers disclaim any beneficial interest.

(5) Mr. Sid R. Bass, solely in his capacity as President of Sid R. Bass, Inc.,
may also be deemed a beneficial owner of such Paired Shares.

(6) Mr. Lee M. Bass, solely in his capacity as President of Lee M. Bass, Inc.,
may also be deemed a beneficial owner of such Paired Shares.

(7) Mr. Perry R. Bass, solely in his capacity as sole Trustee and as one of two
trustors of the Bass Management Trust, may also be deemed a beneficial owner
of such Paired Shares.

(8) Mr. Dort A. Cameron, III, solely in his capacity as one of two general
partners of EBD L.P., which is the sole general partner of The Airlie Group,
L.P., may also be deemed a beneficial owner of such Paired Shares.

(9) Mr. William P. Hallman, Jr., solely in his capacity as President and sole
stockholder of TMT-FW, Inc., which is one of two general partners of EBD
L.P., which is the sole general partner of The Airlie Group, L.P., may also
be deemed a beneficial owner of such Paired Shares.

(10) This amount does not include (a) 527,188 Paired Shares held by Annie R.
Bass Grandson's Trust for Sid R. Bass of which Mr. Hallman is the Trustee,
(b) 527,188 Paired Shares held by Annie R. Bass Grandson's Trust for Lee M.
Bass of which Mr. Hallman is the Trustee, (c) 32,783 Paired Shares held by
TF Investors, L.P., which is indirectly controlled by Trinity Capital
Management, Inc., of which Mr. Hallman is the President and sole
stockholder, (d) 269,633 Paired Shares held by the Airlie Group which is
indirectly controlled by TMT-FW, Inc. of which Mr. Hallman is the President
and sole stockholder, and (e) 419,398 Paired Shares held by FW Trinity
Limited Investors, L.P., which is indirectly controlled by TF-FW
Investors, Inc. of which Mr. Hallman is President and one of two
stockholders.

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<PAGE>
(11) Mr. Hallman, solely in his capacity as Trustee of the Annie R. Bass
Grandson's Trust for Lee M. Bass, may also be deemed a beneficial owner of
such Paired Shares.

(12) Mr. Hallman, solely in his capacity as Trustee of the Annie R. Bass
Grandson's Trust for Sid R. Bass, may also be deemed a beneficial owner of
such Paired Shares.

(13) This amount does not include 419,398 Paired Shares held by FW Trinity
Limited Investors, L.P., whose sole general partner is TF-TW
Investors, Inc., of which Mr. Sterling is one of two stockholders.

(14) Panther City Production Company, solely in its capacity as sole shareholder
of Panther City Investment Company, the Trustee of the Hyatt Anne Bass
Successor Trust, may also be deemed a beneficial owner of such Paired
Shares.

(15) Panther City Production Company, solely in its capacity as sole shareholder
of Panther City Investment Company, the Trustee of Samantha Sims Bass
Successor Trust, may also be deemed a beneficial owner of such Paired
Shares.

(16) Mr. Hallman, solely in his capacity as President and sole stockholder of
Trinity Capital Management, Inc., the sole general partner of TF Investors,
L.P., may also be deemed a beneficial owner of such Paired Shares.

(17) Mr. Hallman, solely in his capacity as President and one of two
stockholders of TF-FW Investors, Inc., which is the sole general partner of
FW Trinity Limited Investors, L.P., may also be deemed a beneficial owner of
such Paired Shares. Mr. Sterling, solely in his capacity as one of two
stockholders of TF-TW Investors, Inc., which is the sole general partner of
FW Trinity Limited Investors, L.P., may also be deemed a beneficial owner of
such Paired Shares.

(18) Mr. Richard Strutz, solely in his capacity as President of National Bancorp
of Alaska, Inc., may also be deemed a beneficial owner of such Paired
Shares.

(19) Information provided is based solely on information contained in a Schedule
13G filed by Merrill Lynch & Co., Inc. on behalf of Merrill Lynch Asset
Management Group, on April 7, 2000.

The information reflected for certain beneficial owners listed under the
heading "5% Shareholders" is based on statements and reports filed with the SEC
and furnished to The Meditrust Companies by such holders. No independent
investigation concerning the accuracy thereof has been made by The Meditrust
Companies.

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<PAGE>
ANNUAL MEETING PROPOSALS OF THE MEDITRUST COMPANIES

ANNUAL REPORT

The Annual Report of The Meditrust Companies for the fiscal year ended
December 31, 1999, including financial statements, audited and reported upon by
PricewaterhouseCoopers, L.L.P., independent accountants, is being mailed
herewith to each of The Meditrust Companies' shareholders of record at the close
of business on June 8, 2000.

EXECUTIVE COMPENSATION--MEDITRUST

The following table sets forth the compensation paid to those individuals
who served as Meditrust's Chief Executive Officer, or in a similar capacity, and
the four other most highly compensated executive officers other than the Chief
Executive Officer, or such individuals who served in a similar capacity, in 1999
for services rendered in all capacities to Meditrust and its subsidiaries during
the fiscal years ended December 31, 1999, 1998 and 1997.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION AWARDS
---------------------------------------
AWARDS
RESTRICTED SECURITIES
ANNUAL COMPENSATION STOCK UNDER-LYING ALL OTHER
----------------------- AWARDS(S) OPTIONS/ COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($)(4) BONUS($) ($)(6) SARS(#) ($)(2)
--------------------------- -------- ------------ -------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Francis W. Cash(1).................. 1999 N/A N/A N/A N/A N/A
Chief Executive Officer and
President

Michael S. Benjamin................. 1999 300,000 221,607(3) 178,125 -0- 6,786
Senior Vice President and 1998 300,000 194,718(3) 1,125,000 150,000 6,785
Secretary 1997 200,000 238,141(3) 6,536

Michael F. Bushee................... 1999 300,000 221,607(3) 178,125 -0- 6,627
Chief Operating Officer 1998 300,000 194,718(3) 1,125,000 150,000 6,627
1997 200,000 238,141(3) 6,377

Laurie T. Gerber.................... 1999 275,000 215,000 178,125 -0- 6,157
Chief Financial Officer 1998 250,000 150,000 1,125,000 150,000 6,157
1997 155,000 149,525(4) 5,907

David F. Benson(7).................. 1999 500,000 10,096(5) 178,125 -0- 6,860
Former Chief Executive Officer and 1998 500,000 319,912(5) 2,812,500 375,000 6,860
President 1997 350,000 391,382(5) 6,610
</TABLE>

------------------------

(1) Mr. Cash became Meditrust's Chief Executive Officer and President on
April 17, 2000. Accordingly, no compensation information is presented for
Mr. Cash.

(2) Includes 401(k) plan contribution of $5,000, $5,000, $5,000 and $5,000 in
1999, $5,000, $5,000, $5,000 and $5,000 in 1998, $4,750, $4,750, $4,750 and
$4,750 in 1997, and term life insurance premium payments of $1,860, $1,786,
$1,627 and $1,157 in 1999, $1,860, $1,785, $1,627 and $1,157

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<PAGE>
in 1998, $1,860, $1,785, $1,627, and $1,157 in 1997, on behalf of
Messrs. Benson, Benjamin and Bushee and Ms. Gerber, respectively.

(3) For the years 1999, 1998 and 1997, $6,607, $44,718, and $86,875 of which
relates to Meditrust's issuance to each of Messrs. Benjamin and Bushee of
(i) 428 Shares in one installment valued at $15.44 per Share on January 4,
2000, (ii) 1,646 Shares in four installments valued at $36.38, $30.94,
$26.81 and $16.00 per Share in January, 1998, April, 1998, July, 1998 and
October, 1998; and (iii) 2,734 Shares in installments valued at $30.27,
$31.89 and $36.38 per Share on April 1, 1997, July 1, 1997 and January 2,
1997. All issuance prices were the closing prices for Shares on the New York
Stock Exchange on the respective dates of issuance.

(4) For the year 1997, $39,472 of which relates to Meditrust's issuance to
Ms. Gerber of (i) 1,224 Shares in three equal installments valued at $30.27,
$31.89 and $34.59 per Share on April 1, 1997, July 1, 1997 and October 10,
1997. All issuance prices are the closing prices for Shares on the New York
Stock Exchange on the respective dates of issuance.

(5) For the years 1999, 1998 and 1997, $10,096, $69,912, and $167,286 of which
relates to Meditrust's issuance to Mr. Benson of (i) 654 Shares in one
installment valued at $15.44 per Share on January 4, 2000 (ii) 2,558 Shares
in four installments valued at $36.38, $30.94, $26.81 and $16.00 per Share
in January, 1998, April, 1998, July, 1998 and October, 1998; and
(iii) 5,097 Shares in three installments valued at $30.27, $31.89 and $36.38
per Share on April 1, 1997, July 1, 1997 and October 10, 1997. All issuance
prices were the closing prices for Shares on the New York Stock Exchange on
the respective dates of issuance.

(6) On August 5, 1999, Meditrust issued 10,000, 10,000, and 10,000 Shares of
restricted stock, which as of December 31, 1999 had a value of $55,000,
$55,000 and $55,000 to Messrs. Benjamin and Bushee and Ms. Gerber. On
July 31, 1998, Meditrust issued 125,000, 50,000, 50,000 and 50,000 Shares of
restricted stock, which as of December 31, 1998 had a value of $1,875,000,
$750,000, $750,000 and $750,000, to Messrs. Benson, Benjamin and Bushee and
Ms. Gerber. The restricted stock vests on the earlier of the 8th year or
upon achievement of the following performance criteria: achievement of Funds
from Operations of $2.92 in 2000, $3.10 in 2001, $3.28 in 2002, $3.48 in
2003 and $3.69 in 2004. All of the restricted stock immediately vests upon a
change of control of Meditrust. Dividends were paid in August and November
as to 1999 and August, September and November as to 1998.

(7) Mr. Benson ceased to serve as Meditrust's Chief Executive Officer and
President on February 1, 2000.

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<PAGE>
The following table sets forth information concerning the grant of stock
options to the following persons during the fiscal year ended December 31, 1999:

OPTION GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
NUMBER OF PERCENT OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED EXERCISE ON GRANT
OPTIONS TO EMPLOYEES BASE PRICE EXPIRATION DATE PRESENT
NAME GRANTED(#) IN 1999 ($/SHARE) DATE VALUE ($)
---- ---------- ---------------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Francis W. Cash..................... N/A N/A N/A N/A N/A
Michael S. Benjamin................. -0- -0- -0- -0- -0-
Michael F. Bushee................... -0- -0- -0- -0- -0-
Laurie T. Gerber.................... -0- -0- -0- -0- -0-
David F. Benson..................... -0- -0- -0- -0- -0-
</TABLE>

The following table sets forth information concerning exercises of stock
options by the following persons during the fiscal year ended December 31, 1999
and the number and value of their stock options at December 31, 1999:

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES VALUE UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
ACQUIRED ON REALIZED OPTIONS AT 12/31/99 (#) 12/31/99 ($)EXERCISABLE/
NAME EXERCISE(#) ($)(1) EXERCISABLE/UNEXERCISABLE UNEXERCISABLE(2)
---- ----------- -------- ------------------------- ------------------------
<S> <C> <C> <C> <C>
Francis W. Cash................. N/A N/A N/A N/A
Michael S. Benjamin............. -0- -0- 201,234/341,289 -0-/-0-
Michael F. Bushee............... -0- -0- 201,234/341,289 -0-/-0-
Laurie T. Gerber................ -0- -0- 73,063/197,097 -0-/-0-
David F. Benson................. -0- -0- 345,723/600,885 -0-/-0-
</TABLE>

------------------------

(1) Market value of underlying securities at exercise, less the exercise price.

(2) Market value of $5.50 as of December 31, 1999, less the exercise price.

8
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE(1)

In determining the compensation to be paid to Meditrust's executive
officers, the Compensation Committee (the "Compensation Committee") strives to
(i) reward executives for achievement of Meditrust's strategic goals and the
enhancement of shareholder value and (ii) attract, motivate and retain
highly-trained and talented executives who are vital to Meditrust's long-term
success. Individual compensation packages are generally set at levels believed
by the Compensation Committee to correspond to the median range of compensation
paid to individuals serving in comparable positions at other real estate
investment trusts with publicly-traded securities (including those comprising
the National Association of Real Estate Investment Trusts Index referred to in
the performance graph set forth hereinafter). At present, Meditrust's
compensation package is comprised of a base salary, an annual cash bonus,
long-term incentives in the form of stock options and stock grants and other
benefits typically offered to executives by major corporations.

SALARIES

During 1999, the Board of Directors, on the recommendation of the
Compensation Committee, did not increase the salaries paid to the Chief
Executive Officer or to the other named executive officers of Meditrust except
that Meditrust increased the salary of Laurie Gerber, the Chief Financial
Officer, by $25,000. This salary increase was based on cost-of-living
adjustments, position tenure, subjective assessments of individual performance,
comparability considerations and competitive data, including asset growth,
revenue growth, cash flow growth and total return to shareholders.

Under certain circumstances, Section 162(m) of the Internal Revenue Code
denies a deduction for compensation in excess of $1 million paid to an
individual who is the chief executive officer or one of the four next most
highly paid officers of a corporation. In general, compensation from all sources
is taken into account including salary, bonus and income realized from the
exercise of non-qualified stock options. Because it is a real estate investment
trust, and based on the advice of counsel, Meditrust believes that the denial of
deductions by Section 162(m) is not likely to have any adverse impact on
Meditrust. A real estate investment trust is subject to tax on its "real estate
investment trust taxable income," which is taxable income subject to adjustments
and reduced by a deduction for dividends paid. Meditrust expects to pay
sufficient dividends such that it will have no real estate investment trust
taxable income even if Section 162(m) were to be applicable to compensation paid
to one or more of its officers.

BONUS AWARDS

Executive officers of Meditrust were awarded cash bonuses in 1999 based on
the Compensation Committee's assessment of Meditrust's and the employees'
performance. The performance measures

------------------------

(1) The report of the Compensation Committee shall not be deemed to be
incorporated by reference by any general statement incorporating by
reference this Joint Proxy Statement into any filings of The Meditrust
Companies pursuant to the Securities Act of 1933, as amended (the
"Securities Act") or The Securities Exchange Act of 1934, as amended (the
"Exchange Act"), except to the extent The Meditrust Companies specifically
incorporate this report by reference therein, and shall not be deemed
soliciting material or otherwise deemed filed under either such Acts.

9
<PAGE>
reviewed by the Compensation Committee included Meditrust's formulating the Five
Point Plan of Reorganization to improve the overall financial condition of
Meditrust.

EQUITY INCENTIVE PLANS

The Compensation Committee administers Meditrust's 1995 Share Award Plan.
Stock options and stock grants are awarded under this plan in order to provide
incentives to Directors, officers and key employees of Meditrust to maximize
their efforts on behalf of Meditrust, to attract and retain those highly
competent individuals upon whose judgment, initiative and leadership Meditrust's
continuing success largely depends and to align the interests of the Directors,
officers and key employees of Meditrust with those of Meditrust's shareholders.
The size of individual option and stock grants is determined by the Compensation
Committee based on its comparison of option and stock grants to executives with
similar responsibilities in other companies and the executive's level of
responsibility and relative importance to the operations of Meditrust.

It is the present policy of the Compensation Committee to review
periodically Meditrust's stock option and stock grant award levels and the
over-all effectiveness of Meditrust's equity incentive plans in achieving the
objectives of Meditrust.

During 1999, other than issuing 10,000 shares of restricted stock each to
Messrs. Benjamin and Bushee and Ms. Gerber on August 5, 1999 in consideration of
services rendered to Meditrust in furtherance of the pursuit and implementaton
of Meditrust's strategic restructuring plan, Meditrust did not award stock
options or stock grants under the 1995 Share Award Plan to the Chief Executive
Officer, to anyone acting in the capacity of an executive officer, or to any of
the named executive officers.

OTHER COMPENSATION PLANS

Meditrust maintains certain broad-based employee benefit plans in which the
Senior Executives participated. These plans include a 401(k) savings plan, life,
disability and health insurance plans and allowances for automobile use. These
plans are not directly or indirectly tied to Meditrust's performance.

Submitted by,

Stephen E. Merrill (Chairman)
William C. Baker
Clive D. Bode
Francis W. Cash
John C. Cushman, III

10
<PAGE>
EXECUTIVE COMPENSATION--OPERATING COMPANY

The following table sets forth the compensation paid to those individuals
who served as Operating Company's Chief Executive Officer during 1999 for
services rendered in all capacities to Operating Company and its subsidiaries
during the fiscal years ended December 31, 1999, 1998 and 1997.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
AWARDS
-------------------------
ANNUAL COMPENSATION RESTRICTED ALL OTHER
------------------------------- STOCK COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) AWARDS($) ($)(2)
--------------------------- -------- --------- -------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Francis W. Cash(1)............................ 1999 N/A N/A N/A N/A
Chief Executive Officer,
President and Treasurer

William C. Baker(6)........................... 1999 0 0 0 0
Former Chief Executive Officer, 1998 0 45,844 0(3) 0(4)
President and Treasurer 1997 300,000 350,000 0 4,352(5)
</TABLE>

------------------------

(1) Mr. Cash became Chief Executive Officer and President in April 2000.
Accordingly, no compensation information is presented for Mr. Cash.

(2) Includes 401(k) plan contribution of $0 in 1998, $0 in 1997 and $0 in 1996,
and term life insurance premium payments of $0 in 1998, $4,352 in 1997, on
behalf of Mr. Baker.

(3) On July 31, 1998, Operating issued 75,000 Shares of restricted stock at
$22.50 per Share to Mr. Baker, which as of the grant date had a value of
$1,687,500. As of December 31, 1998 the restricted stock had a value of
$1,125,000. This grant was forfeited on January 4, 1999. Dividends were paid
in August, September and November of 1998.

(4) Does not include severance payments of $1,723,800 paid to Mr. Baker.

(5) Does not include severance payments of $1,583,233 paid in 1997 to Mr. Baker
in connection with the Santa Anita Merger.

(6) Mr. Baker ceased to serve as Operating Company's Chief Executive Officer,
President and Treasurer in April 2000.

Operating Company made no grants of options and the individual who served as
Chief Executive Officer during 1999 did not own or receive any options to
purchase any Paired Shares during 1999.

11
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE(2)

In determining the compensation to be paid to Operating Company's executive
officers, the Compensation Committee of Operating Company (the "Operating
Company Compensation Committee") strives to (i) reward executives for
achievement of Operating Company's strategic goals and the enhancement of
shareholder value and (ii) attract, motivate and retain highly-trained and
talented executives who are vital to Operating Company's long-term success. At
present, Operating Company's compensation package is comprised of a base salary,
an annual cash bonus, long-term incentives in the form of stock options and
stock grants and other benefits typically offered to executives by major
corporations. Notwithstanding this general philosophy, Operating Company did not
pay its Chief Executive Officer or any other executive officer any salary or
bonus, nor did it award any equity grants, in 1999 for serving Operating Company
in such capacity. It is likely, however, that as The Meditrust Companies pursue
the restructuring plan announced in January 2000, individuals may begin serving
Operating Company in an executive capacity and will begin receiving such
compensation types.

SALARIES

During 1999, Operating Company's Chief Executive Officer did not receive a
salary from Operating Company.

BONUS AWARDS

No executive officers of Operating Company were awarded cash bonuses in
1999.

EQUITY INCENTIVE PLANS

The Operating Company Compensation Committee administers Operating Company's
1995 Share Award Plan. Stock options and stock grants are awarded under this
plan in order to provide incentives to Directors, officers and key employees of
Operating Company to maximize their efforts on behalf of Operating Company, to
attract and retain those highly competent individuals upon whose judgment,
initiative and leadership Operating Company's continuing success largely depends
and to align the interests of the Directors, officers and key employees of
Operating Company with those of Operating Company's shareholders. The size of
individual option and stock grants is determined by the Operating Company
Compensation Committee based on its comparison of option and stock grants to
executives with similar responsibilities in other companies and the executive's
level of responsibility and relative importance to the operations of Operating
Company.

It is the present policy of the Operating Company Compensation Committee to
review periodically Operating Company's stock option and stock grant award
levels and the over-all effectiveness of Operating Company's equity incentive
plans in achieving the objectives of Operating Company.

------------------------

(2) The report of the Operating Company Compensation Committee shall not be
deemed to be incorporated by reference by any general statement
incorporating by reference this Joint Proxy Statement into any filings of
The Meditrust Companies pursuant to the Securities Act or the Exchange Act,
except to the extent The Meditrust Companies specifically incorporate this
report by reference therein, and shall not be deemed soliciting material or
otherwise deemed filed under either such Acts.

12
<PAGE>
During 1999, Operating Company did not award stock options or stock grants
under the 1995 Share Award Plan to the Chief Executive Officer or to anyone
acting in the capacity of an executive officer.

OTHER COMPENSATION PLANS

Operating Company maintains certain broad-based employee benefit plans in
which the Operating Company Senior Executives participated. These plans include
a 401(k) savings plan, life, disability and health insurance plans and
allowances for automobile use. These plans are not directly or indirectly tied
to Operating Company's performance.

Submitted by,

Stephen E. Merrill (Chairman)
William C. Baker
Clive D. Bode
Francis W. Cash
John C. Cushman, III

13
<PAGE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Based solely upon a review of Forms 3 and 4 and amendments thereto furnished
to The Meditrust Companies during its most recent fiscal year, Forms 5 and
amendments thereto furnished to The Meditrust Companies with respect to its most
recent fiscal year and written representations furnished to The Meditrust
Companies, no officer, Director or 10% beneficial owner of The Meditrust
Companies failed to timely file a required Form except that one transaction
involving the purchase of 1000 shares was inadvertently filed ten days after the
deadline by Stephen E. Merrill. This Form 4 was subsequently filed by
Mr. Merrill.

PERFORMANCE GRAPH (1)

Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareholder return on the shares of Meditrust's Predecessor
and The Meditrust Companies against the cumulative market-weighted return of the
Standard & Poor's Composite 500 Stock Index and the National Association of Real
Estate Investment Trusts ("NAREIT") All REIT Total Return Index (which is
comprised of all tax-qualified real estate investment trusts, without regard to
investment focus, listed on the New York Stock Exchange, American Stock Exchange
and NASDAQ National Market System) for the period of five fiscal years
commencing January 1, 1995 and ending December 31, 1999.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
1994 1995 1996 1997 1998 1999
<S> <C> <C> <C> <C> <C> <C>
Meditrust 100.00 120.12 149.26 147.16 71.44 30.73
S&P 500 100.00 137.43 168.98 225.37 289.78 350.72
NAREIT 100.00 118.31 160.61 190.90 154.97 144.93
</TABLE>

------------------------

(1) Assumes that the value of an investment in Paired Shares and each index was
$100 on December 31, 1994 and that all dividends were reinvested on a
monthly basis.

14
<PAGE>
PROPOSAL 1--ELECTION OF DIRECTORS OF THE MEDITRUST COMPANIES

The respective Boards of Directors of each of The Meditrust Companies are
divided into three classes. Each class has a term of three years and the terms
are staggered so that in each year only one class of Directors for each of The
Meditrust Companies is elected. The nominees standing for re-election in 2000
for each of The Meditrust Companies, together with the Directors whose terms do
not expire, are listed below. Edward W. Brooke, whose terms expire at the 2000
annual meetings, is not seeking re-election to the Boards of Directors of The
Meditrust Companies. It is the intention of the persons named as proxies in the
accompanying form of proxy (unless otherwise indicated) to vote such proxies to
elect the nominees for Director named in the following table, all of whom are
currently members of the Board of Directors. If elected, the nominees will serve
as Directors until The Meditrust Companies 2003 annual meetings and until their
successors are chosen and qualified. In the event that any of the nominees
becomes unavailable (which is not now anticipated by The Meditrust Companies),
the persons named as proxies have discretionary authority to vote for a
substitute or to reduce the number of Directors to be fixed and elected. The
Boards of Directors have no reason to believe that any of said persons will be
unwilling or unable to serve if elected. Election of each of the nominees will
require the affirmative vote of a majority of the stock having voting power
present in person or represented by proxy and voting at the Meditrust Meeting or
the Operating Company Meeting, provided that such majority is at least a
majority of the number of shares required to constitute a quorum. Abstentions
and broker non-votes with regard to any item being acted upon at the Meeting
will not be treated as votes cast.

NOMINEES FOR DIRECTOR

<TABLE>
<CAPTION>
DIRECTOR OF
DIRECTOR OF OPERATING
MEDITRUST AND ITS
NAME AND PRINCIPAL AND ITS PREDECESSOR
OCCUPATION OR EMPLOYMENT AGE PREDECESSOR SINCE SINCE TERMS EXPIRE
------------------------ --- ----------------- ----------- ------------
<S> <C> <C> <C> <C>
William C. Baker.............................. 67 2000 1991 2000
Retired

John C. Cushman, III.......................... 59 1996 2000 2000
President and Chief Executive Officer of
Cushman Realty Corporation, a commercial
real estate brokerage firm
</TABLE>

15
<PAGE>
THE BOARDS OF DIRECTORS OF THE MEDITRUST COMPANIES RECOMMENDS THAT YOU VOTE
"FOR" THE NOMINEES FOR DIRECTOR.

CONTINUING DIRECTORS

<TABLE>
<CAPTION>
DIRECTOR OF
DIRECTOR OF OPERATING
MEDITRUST AND ITS
NAME AND PRINCIPAL AND ITS PREDECESSOR
OCCUPATION OR EMPLOYMENT AGE PREDECESSOR SINCE SINCE TERMS EXPIRE
------------------------ -------- ----------------- ----------- ------------
<S> <C> <C> <C> <C>
Clive D. Bode......................... 56 1999 1999 2002
Chairman

William G. Byrnes..................... 49 2000 1998 2001
Chairman and Chief Executive Officer
of Paladin Ventures LLC

Francis W. Cash....................... 58 2000 2000 2001
Chief Executive Officer and
President of Meditrust
Chief Executive Officer, President
and Treasurer of Operating Company

James P. Conn......................... 62 1995 2000 2002
Former Managing Director and Chief
Investment Officer of Financial
Security Assistance, Inc., an
insurance company

Stephen E. Merrill.................... 53 1998 1998 2002
President, Bingham Consulting Group,
LLC
</TABLE>

NOMINEES FOR DIRECTOR

William C. Baker has been a Director of Operating Company since
October 1991 and was appointed a Director of Meditrust in April 2000. Mr. Baker
served as President and Treasurer of Operating Company from August 1998 through
April 2000. Mr. Baker was Chief Executive Officer of Santa Anita Companies from
April 1996 to December 1998. Mr. Baker was the President of Red Robin
International, Inc. from 1993 to 1995, a private investor from 1988 to 1992 and
Chairman of the Board and Chief Executive Officer of Del Taco, Inc. from 1976 to
1988. He served as Chairman of the Board of Coast Newport Properties from 1991
to 1999. Mr. Baker is a Director of Callaway Golf Company and Public
Storage, Inc.

John C. Cushman, III has been a Director of Meditrust since 1996 and was
appointed a Director of Operating Company in April 2000. Mr. Cushman has been
the President and Chief Executive Officer of Cushman Realty Corporation since
1978. He is a Director of National Golf Properties, Inc., Los Angeles Turf Club,
Incorporated, Digital Gene Technologies, Inc., Cushman Realty Corporation,
Cushman Winery Corporation and Inglewood Park Cemetery.

16
<PAGE>
CONTINUING DIRECTORS

Clive D. Bode has been Chairman of the Boards of Meditrust and Operating
Company since October 1999. Mr. Bode has been a special advisor to certain
members of the Bass Family of Fort Worth, Texas for the past 10 years. Mr. Bode
is also Director of Kelly, Hart & Hallman, a Fort Worth based law firm.

William G. Byrnes has been a Director of Operating Company since 1998 and
was appointed a Director of Meditrust in April 2000. Mr. Byrnes served as Chief
Executive Officer of Meditrust from January 2000 through Mr. Cash's appointment
in April 2000. He was previously a Distinguished Professor of Finance at
Georgetown University, from August 1988 to May 1999, and was associated with
Alex. Brown and Sons, investment bankers, from 1981 through 1998. Mr. Byrnes is
also Chairman and CEO of Paladin Ventures LLC and a Director of JDN Realty
Corporation, a real estate development and asset management company traded on
the New York Stock Exchange, a Director of Security Capital Preferred Growth
Incorporated and non-executive Chairman of Pulpfree, Inc.

Francis W. Cash has been President and Chief Executive Officer of Meditrust
and President, Chief Executive Officer and Treasurer of Operating Company since
April 17, 2000. He was the Chairman of the Board, Chief Executive Officer,
President and a director of Mariner Healthcare Group, Inc. from September 8,
1999 until March, 2000. From July 1995 to August 1999, Mr. Cash served as
President and Chief Executive Officer of Red Roof Inns, Inc. ("Red Roof Inns").
He also served as Chairman of the Board of Red Roof Inns from June 1996 to
August 1999. Prior to his service at Red Roof Inns, Mr. Cash served as President
and Chief Operating Officer of NovaCare, Inc. from October 1992 to June 1995.
Prior to that, Mr. Cash served in a number of senior executive positions for
18 years at Marriott Corporation, most recently as President, Marriott Service
Group.

James P. Conn has been a Director of Meditrust since 1995 and was appointed
a Director of Operating Company in April 2000. Mr. Conn was the Managing
Director and Chief Investment Officer of Financial Security Assurance, Inc. from
1992 through 1998. He was also the President and Chief Executive Officer of Bay
Meadows Operating Company from 1988 to 1992. Mr. Conn is a Trustee of Gabelli
Equity Trust, Gabelli Global Multimedia Trust, Gabelli Utility Trust and a
member of the Board of Directors of First Republic Bank. Mr. Conn is also a
Trustee of Gabelli Asset Fund, Gabelli Growth Fund and Gabelli Westwood Funds.

Stephen E. Merrill has been a Director of The Meditrust Companies since
May 1998. Mr. Merrill is the President of Bingham Consulting Group, L.L.C. and
was Of Counsel to the law firm Choate, Hall & Stewart from March 1997 to
February 1999. Previously, Mr. Merrill served as Governor of the State of New
Hampshire from 1993 through 1997. He was senior partner in the law firm
Merrill & Broderick from 1989 through 1993 and served as Attorney General for
the State of New Hampshire from 1985 through 1989. Mr. Merrill also served as
legal counsel and Chief of Staff to the Governor of New Hampshire from 1982
through 1985.

INFORMATION REGARDING THE BOARD OF DIRECTORS OF MEDITRUST

The Board of Directors of Meditrust met 13 times in 1999. Each Director of
Meditrust attended at least 75% of the meetings of the Board of Directors and
all committees on which he served in 1999.

The Acquisition Committee, consisting of Messrs. Bode, Brooke, Byrnes and
Cash, reviews and recommends to the Board of Directors all transactions
involving business acquisitions. The Acquisition Committee was formed in
April 2000.

17
<PAGE>
The Ad Hoc/Special Committee, consisting of Messrs. Brooke, Conn and
Merrill, reviewed issues relating to the separation of former Chief Executive
Officer, Abraham D. Gosman from the Companies. The Ad Hoc/Special Committee met
9 times in 1999 and has been discontinued.

The Audit Committee, consisting of Messrs. Baker, Bode, Byrnes and Conn,
confers with PricewaterhouseCoopers, L.L.P., independent accountants, regarding
the plans, scope and results of their audits and any recommendations they may
have with respect to internal accounting controls and other matters relating to
accounting procedures and the books and records of Meditrust. In 1999, the Audit
Committee, which then consisted of Messrs. Bode and Conn, met 4 times.

The Compensation Committee, consisting of Messrs. Baker, Bode, Cash, Cushman
and Merrill, reviews the compensation of and other employment matters relating
to Meditrust's officers and administrative employees and grants awards under
Meditrust's Share Award Plan. In 1999, the Compensation Committee, which then
consisted of Messrs. Bode, Cushman and Merrill, met 6 times.

The Executive Committee, consisting of Messrs. Baker, Bode, Byrnes, Cash and
Conn, exercises all of the powers of the Board of Directors between meetings of
the Board of Directors, except such powers as are reserved to the Board of
Directors by law. The Executive Committee will consider shareholder
recommendations for nominees for Director. Shareholders of Meditrust wishing to
make recommendations should write to the Executive Committee c/o Michael S.
Benjamin, Esquire, Senior Vice President and Secretary, Meditrust Corporation,
909 Hidden Ridge Road, Suite 600, Irving, Texas 95038. In 1999, the Executive
Committee, which then consisted of Messrs. Benson, Bode, Brooke, Conn and
Merrill met 1 time.

The Investment Committee of Meditrust, consisting of Messrs. Bode, Brooke,
Cash and Cushman, has general oversight and review of all of Meditrust's real
estate financing transactions, and has authority to approve financing
transactions of up to $25 million. In 1999, the Investment Committee, which then
consisted of Messrs. Benson, Brooke, Bode and Cushman, met 2 times.

The Nominating Committee, consisting of Messrs. Bode, Brooke, Cash, Conn and
Merrill, makes recommendations to the Board of Directors concerning the Board's
size and composition and suggests prospective candidates for Director. In 1999,
the Nominating Committee, which then consisted of Messrs. Benson, Bode, Brooke,
Conn and Merrill met 1 time.

INFORMATION REGARDING THE BOARD OF DIRECTORS OF OPERATING COMPANY

The Board of Directors of Operating Company met 13 times in 1999. Each
Director of Operating Company attended at least 75% of the meetings of the Board
of Directors and all committees on which he served in 1999.

The Ad Hoc/Special Committee, consisting of Messrs. Brooke and Merrill,
reviewed issues relating to the separation of former Chief Executive Officer,
Abraham D. Gosman from the Companies. The Ad Hoc/Special Committee met 9 times
in 1999 and has been discontinued.

18
<PAGE>
other matters relating to accounting procedures and the books and records of
Operating Company. In 1999, the Audit Committee, which then consisted of
Messrs. Baker, Bode and Byrnes, met 4 times.

The Compensation Committee, consisting of Messrs. Baker, Bode, Cash, Cushman
and Merrill, reviews the compensation of and other employment matters relating
to Operating Company's officers and administrative employees and grants awards
under Operating Company's Share Award Plan. In 1999, the Compensation Committee,
which then consisted of Messrs. Baker, Bode and Merrill, met 6 times.

The Executive Committee, consisting of Messrs. Baker, Bode, Byrnes, Cash and
Conn, exercises all of the powers of the Board of Directors between meetings of
the Board of Directors, except such powers as are reserved to the Board of
Directors by law. The Executive Committee will consider shareholder
recommendations for nominees for Director. Shareholders of Operating Company
wishing to make recommendations should write to the Executive Committee c/o
Gilbert G. Menna, Esquire, Secretary, Meditrust Operating Company, 909 Hidden
Ridge Road, Suite 600, Irving, Texas 95038. In 1999, the Executive Committee,
which then consisted of Messrs. Benson, Bode, Brooke and Merrill, met 1 time.

FURTHER INFORMATION REGARDING THE BOARDS OF DIRECTORS AND EXECUTIVE OFFICERS

DIRECTORS COMPENSATION

The Meditrust Companies pay each Director who is not otherwise an employee
of The Meditrust Companies a fee of $30,000 per year for services as a Director
plus $1,000 per day for attendance at each meeting of the full Board of
Directors. In addition, the Chairman and each member of a committee of the Board
of Directors are paid $1,250 and $1,000, respectively, for attendance at a
committee meeting. The Meditrust Companies reimburse the Directors for travel
expenses incurred in connection with their duties as Directors of The Meditrust
Companies. In addition, The Meditrust Companies from time to time pays Directors
additional fees in connection with various special projects.

EMPLOYMENT ARRANGEMENTS

EMPLOYMENT ARRANGEMENT WITH CHIEF EXECUTIVE OFFICER AND PRESIDENT FRANCIS W.
CASH. Effective April 17, 2000, Francis W. Cash ("Mr. Cash") entered into an
Employment Agreement with Meditrust. Mr. Cash's Employment Agreement provides
that he will serve as President and Chief Executive Officer of Meditrust until
the third anniversary of the effective date of his Employment Agreement, at
which time the Employment Agreement will be renewed automatically thereafter for
successive one-year terms unless six (6) months notice of non-renewal is given
by either party to the other. For the year 2000, Meditrust shall pay Mr. Cash an
end-of-year bonus of no less than the pro rata amount of his base salary, based
on the number of days worked in the year 2000. For each fiscal year

19
<PAGE>
thereafter, if the goals and criteria established by the Compensation Committee
are met, Mr. Cash shall receive a year-end cash bonus in an amount equal to up
to 100% of his base salary. In the event that Mr. Cash significantly exceeds the
annual goals and criteria established by the Compensation Committee, he is
eligible to receive a cash bonus in an amount equal to up to 200% of his base
salary.

Upon termination of Mr. Cash's employment due to death or disability of
Mr. Cash, Meditrust shall pay to Mr. Cash (or his beneficiary in the event of
his death) any base salary, bonus or other compensation earned but not paid and
the pro rata amount of the annual base target bonus payable. Additionally,
Meditrust will continue to provide health benefits for at least two years.

Upon termination of Mr. Cash's employment by Meditrust other than for cause
or by Mr. Cash for "Good Reason," Meditrust shall pay Mr. Cash, in addition to
the amounts described in the immediately preceding paragraph, a lump sum payment
equal to two times the sum of Mr. Cash's base salary and base target bonus.
Further, 20% of the original number of Mr. Cash's Performance Shares and Options
covering 20% of the original number of Paired Shares in each Option shall
accelerate and become vested and exercisable. Additionally, Meditrust will
continue to provide health benefits for at least two years.

If a "Change in Control" (as defined in Mr. Cash's Employment Agreement)
occurs and Mr. Cash's employment is terminated within two years of such Change
in Control as a result of an Executive Termination Event (as defined in
Mr. Cash's Employment Agreement), Mr. Cash shall be entitled to the following
severance benefits: (i) an amount equal to three times the average of his annual
base salary (for the three fiscal years preceding the Change in Control) and
three times the average of his cash bonuses paid (for the two fiscal years
preceding the Change in Control); (ii) an amount equal to Mr. Cash's full base
salary through the termination date and the pro rata amount of the maximum base
target bonus available during such year; and (iii) all unvested equity,
including Performance Shares and Options, shall become fully vested and
exercisable. Additionally, Meditrust will purchase Mr. Cash's house at market
value, provide certain outplacement assistance and will continue to provide
health benefits for the balance of the term.

EMPLOYMENT ARRANGEMENTS WITH EXECUTIVE OFFICERS MICHAEL S. BENJAMIN, MICHAEL
F. BUSHEE AND LAURIE T. GERBER. Effective January 1, 1999, each of Michael S.
Benjamin, Michael F. Bushee and Laurie T. Gerber (each, an "Executive") entered
into an Employment Agreement with Meditrust. Messrs. Benjamin's and Bushee's and
Ms. Gerber's Employment Agreements provide that they will serve as the Senior
Vice President and General Counsel, Chief Operating Officer and Chief Financial
Officer, respectively, of Meditrust until the third anniversary of the effective
date of the respective Employment Agreement. Each Employment Agreement is
automatically extended for an additional one-year term unless either of the
respective parties thereto elects to terminate the respective Employment
Agreement by notice in writing at least 90 days prior to the end of the term of
such Employment Agreement. Each Executive is eligible to receive an annual bonus
to be determined by the Compensation Committee of an amount 40% and 80% of his
or her base compensation. Upon termination of employment due to the death or
disability of an Executive, all unexercisable stock options and non-vested
stock-based grants and performance units will immediately vest and will be
exercisable for 90 days. Additionally, Meditrust will provide health insurance
coverage for at least two years.

If an Executive's employment is terminated by such Executive for "good
reason," or if Meditrust terminates his or her employment without "cause,"
Meditrust will pay such Executive a severance

20
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payment equal to, at a minimum, two times the sum of his or her average base
compensation (determined in accordance with the respective Employment Agreement)
and average incentive compensation (determined in accordance with the respective
Employment Agreement) (for each Executive, the "Severance Payment").

If a "Change in Control" (as defined in the respective Employment Agreement)
occurs and the Executive's employment is terminated for any reason other than
death, disability or voluntary resignation within two years of such Change in
Control, Meditrust must pay the subject Executive a lump sum amount equal to
such Executive's Severance Payment and all stock options and other stock-based
awards and performance units will become immediately exercisable or
non-forfeitable.

EMPLOYMENT SEPARATION AGREEMENT WITH FORMER CHIEF EXECUTIVE OFFICER DAVID F.
BENSON. On January 28, 2000, David F. Benson and the Meditrust Companies
entered into a separation agreement terminating the Employment Agreement entered
into as of January 1, 1999, by and between Meditrust and Mr. Benson. The
separation agreement governs the separation of Mr. Benson from the Meditrust
Companies and confirms his resignation from the office of Chief Executive
Officer of Meditrust. As part of the separation agreement Mr. Benson received a
severance payment of $8,995,000 in cash and 155,000 paired shares of the
Meditrust Companies' stock (which represented the vesting of previously awarded
performance shares), and, to the extent he had participated in such plans prior
to the separation, the continuation for a five year period of participation in
the Meditrust Companies' group health and dental plans and in the life and
disability insurance plans. Both Mr. Benson and the Meditrust Companies agreed
to release and discharge all charges, complaints, claims, causes of action,
damages and debts that related in any manner to Mr. Benson's employment with or
termination of employment from the Meditrust Companies. As part of the
separation agreement Mr. Benson agreed to provide consulting services to the
Meditrust Companies for a ten (10) month period for which the Meditrust
Companies agreed to pay him a fee of $400,000.

FAMILY RELATIONSHIPS

There are no family relationships among any of the Directors or executive
officers of The Meditrust Companies.

INDEPENDENT ACCOUNTANTS

PricewaterhouseCoopers, L.L.P. were the independent accountants of The
Meditrust Companies for fiscal 1999. The Boards of Directors intend to select
them as independent accountants of The Meditrust Companies for fiscal 2000 at
its annual meeting on July 20, 2000. Representatives of PricewaterhouseCoopers,
L.L.P. will be present at the Meditrust Meeting and the Operating Company
Meeting and will be afforded an opportunity to make a statement if they desire
to do so. Such representatives of PricewaterhouseCoopers, L.L.P. will also be
available at that time to respond to appropriate questions addressed to the
officer presiding at the Meditrust Meeting and the Operating Company Meeting.

CERTAIN TRANSACTIONS

On March 4, 1998, Meditrust provided acquisition financing in the amount of
$24,228,723 to an entity in which Mr. Bushee owns a 2.5% equity interest, for
the development of 134 acres of land in Jupiter, Florida. The loan balance on
April 30, 2000 was $11,883,100.

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OTHER MATTERS

As of the date of this Joint Proxy Statement, The Meditrust Companies'
Boards of Directors know of no business, matters or proposals which will be
presented for consideration at the respective meetings other than as described
in this Joint Proxy Statement. If any other matters shall properly come before
the Meditrust Meeting or the Operating Company Meeting and be voted upon, the
enclosed proxies will be deemed to confer discretionary authority on the
individuals named as proxies therein to vote the shares represented by such
proxies as to any such matters. The persons named as proxies intend to vote in
accordance with the recommendation of the management of Meditrust or Operating
Company.

PROPOSALS BY SHAREHOLDERS

Any Meditrust or Operating Company shareholder who intends to submit a
proposal for inclusion in the proxy materials for the 2001 annual meetings of
Meditrust or Operating Company must submit such proposal in writing to the
respective Secretary of Meditrust or Operating Company no earlier than
February 16, 2001 and no later than March 19, 2001, if the proposal is to be
considered for inclusion in the Joint Proxy Statement of Meditrust and Operating
Company and the form of the proxy relating to those meetings. The Meditrust
Companies' By-laws include advance notice and other requirements regarding
proposals for shareholder action at shareholders' meetings other than those
proposed by the Board of Directors. A copy of the By-laws of either Meditrust or
Operating Company may be obtained by written request addressed to the respective
secretary at the address set forth in "The Meditrust and Operating Company
Meetings."

WHERE YOU CAN FIND MORE INFORMATION

The Meditrust Companies file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy reports,
statements, or other information we file at the SEC's public reference rooms in
Washington, D.C., New York, New York and Chicago, Illinois. Please call the SEC
at 800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public from commercial document retrieval
services and at the web site maintained by the SEC at "http://www.sec.gov."

The Meditrust Companies' SEC filings are also available through our website
at "http:// www.reit.com" or by contacting our Investor Relations Departments at
the addresses and phone numbers listed below:

<TABLE>
<S> <C>
Meditrust Corporation Meditrust Operating Company
909 Hidden Ridge Road, Suite 600 909 Hidden Ridge Road, Suite 600
Irving, Texas 95038 Irving, Texas 95038
Attn: Investor Relations Attn: Investor Relations
Tel: (214) 492-6600 Tel: (214) 492-6600
</TABLE>

If you would like to request documents from us, please do so by July 13,
2000 to receive them before the Meditrust Meeting or Operating Company Meeting.
You should rely only on the information contained in this Joint Proxy Statement
to vote on The Meditrust Companies' proposals. We have not authorized anyone to
provide you with information that is different from what is contained in this
Joint Proxy Statement. This Joint Proxy Statement is dated June 9, 2000. You
should not assume that the information contained in this Joint Proxy Statement
is accurate as of any date other than such date, and the mailing of this Joint
Proxy Statement to stockholders shall not create any implication to the
contrary.

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4938-PS-00

<PAGE>

DETACH HERE

PROXY FOR ANNUAL MEETINGS OF SHAREHOLDERS
TO BE HELD JULY 20, 2000

MEDITRUST CORPORATION
MEDITRUST OPERATING COMPANY

The undersigned hereby appoints Francis W. Cash and Michael S. Benjamin,
and each of them acting singly, with full power of substitution, attorneys
and proxies to represent the undersigned at the Annual Meeting of
Shareholders of Meditrust Corporation to be held on July 20, 2000 and at any
adjournment or postponement thereof with all power which the undersigned
would possess if personally present, and to vote all shares of common stock
of Meditrust Corporation which the undersigned may be entitled to vote at
said meeting upon the matters set forth in the Notice of Annual Meeting in
accordance with the following instructions and with discretionary authority
on such other matters as may properly come before the Annual Meeting or any
adjournment or postponement thereof. All previously dated proxies are hereby
revoked.

The undersigned hereby appoints Francis W. Cash and Michael S. Benjamin,
and each of them acting singly, with full power of substitution, attorneys
and proxies to represent the undersigned at the Annual Meeting of
Shareholders of Meditrust Operating Company to be held on July 20, 2000 and
at any adjournment or postponement thereof with all power which the
undersigned would possess if personally present, and to vote all shares of
common stock of Meditrust Operating Company which the undersigned may be
entitled to vote at said meeting upon the matters set forth in the Notice of
Annual Meeting in accordance with the following instructions and with
discretionary authority on such other matters as may properly come before the
Annual Meeting or any adjournment thereof. All previously dated proxies are
hereby revoked.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER SPECIFIED
HEREIN. IF NO SPECIFICATION IS MADE THE PROXIES INTEND TO VOTE FOR EACH OF
THE PROPOSALS.

-------------- --------------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
-------------- --------------

<PAGE>

PROPOSALS

MEDITRUST CORPORATION:

1. TO ELECT THE FOLLOWING DIRECTORS TO SERVE UNTIL 2003:
WILLIAM C. BAKER AND JOHN C. CUSHMAN, III.

MEDITRUST OPERATING COMPANY:

1. TO ELECT THE FOLLOWING DIRECTORS TO SERVE UNTIL 2003:
WILLIAM C. BAKER AND JOHN C. CUSHMAN, III.

DETACH HERE

----- PLEASE MARK
X VOTES AS IN
----- THIS EXAMPLE

PLEASE REFER ABOVE FOR EXPLANATION OF PROPOSALS SET FORTH BELOW

MEDITRUST CORPORATION:

1. To elect the Directors to serve until 2003:
William C. Baker and John C. Cushman, III

FOR ----- ----- WITHHELD
ALL FROM ALL
NOMINEES ----- ----- NOMINEES

-----

----- ______________________________________
For all nominees except as noted above

MEDITRUST OPERATING COMPANY:

1. To elect the Directors to serve until 2003:
William C. Baker and John C. Cushman, III

FOR ----- ----- WITHHELD
ALL FROM ALL
NOMINEES ----- ----- NOMINEES

-----

----- ______________________________________
For all nominees except as noted above

-----
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
-----

In signing, please write name(s) exactly as appearing in the imprint
of this card. For shares held jointly each owner should sign. If
signing as executor, or in any other representative capacity, or as
an officer of a corporation, please indicate your full title as such.

Signature:___________________________ Date: ______________