SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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 ss. 240.14a-12

ElderTrust
- -----------------------------------------------------------------------------
(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:

___________________________________________________________________________

ELDERTRUST
101 East State Street
Suite 100
Kennett Square, Pennsylvania 19348
(610) 925-4200

April 28, 2000

Dear Shareholder:

You are cordially invited to attend the 2000 annual meeting of
shareholders of ElderTrust to be held on Tuesday, May 23, 2000, at 10 a.m., at
101 East State Street, Kennett Square, Pennsylvania 19348.

The annual meeting has been called for the following purposes:

(1) To elect two trustees for a term of three years; and

(2) To transact such other business as may properly come before the
annual meeting or any adjournments.

It is important that your shares be represented at the annual meeting.
Whether or not you plan to attend the annual meeting, you are requested to
complete, date, sign and return the enclosed proxy card in the enclosed
postage-paid envelope.

Very truly yours,

/s/ D. Lee McCreary, Jr.
----------------------------------
D. Lee McCreary, Jr.
President, Chief Executive
Officer, Chief Financial Officer,
Treasurer and Secretary

ELDERTRUST
101 East State Street
Suite 100
Kennett Square, Pennsylvania 19348
(610) 925-4200
------------------

NOTICE TO ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 23, 2000
------------------

NOTICE IS HEREBY GIVEN that the 2000 annual meeting of shareholders of
ElderTrust will be held at 101 East State Street, Kennett Square, Pennsylvania
19348 on Thursday, May 23, 2000 at 10 a.m., for the following purposes:

(1) To elect two trustees for a three-year term and until their
successors are elected and qualified; and

(2) To transact such other business as may properly come before
the meeting or any adjournments.

The board of trustees has fixed March 17, 2000 as the record date for
the determination of shareholders entitled to notice of and to vote at the
annual meeting and all adjournments thereof. Only shareholders of record at the
close of business on that date will be entitled to notice and to vote at the
annual meeting. All shareholders are cordially invited to attend the annual
meeting.

In the event that there are not sufficient votes to approve any one or
more of the foregoing proposals at the time of the annual meeting, the annual
meeting may be adjourned in order to permit further solicitation of proxies by
ElderTrust.

By Order of the Board of Trustees

/s/ D. Lee McCreary, Jr.
-------------------------------------
D. Lee McCreary, Jr.
President, Chief Executive
Officer, Chief Financial Officer,
Treasurer and Secretary

Kennett Square, Pennsylvania
April 28, 2000

Whether or not you plan to attend the annual meeting, you are urged to
sign, date and return the enclosed proxy in the accompanying pre-addressed
envelope which requires no postage stamp. Your proxy may be revoked prior to the
voting by filing with the secretary of ElderTrust a written revocation or a duly
executed proxy bearing a later date or by attending the annual meeting and
voting in person.

ELDERTRUST
101 East State Street
Suite 100
Kennett Square, Pennsylvania 19348
(610) 925-4200
------------------

PROXY STATEMENT
2000 ANNUAL MEETING OF SHAREHOLDERS
May 23, 2000
------------------

SOLICITATION, VOTING AND REVOCABILITY OF PROXIES

This proxy statement is furnished to shareholders of ElderTrust in
connection with the solicitation by the board of trustees of ElderTrust of
proxies to be used at the 2000 annual meeting of shareholders to be held at 101
East State Street, Kennett Square, Pennsylvania 19348 on Tuesday, May 23, 2000
at 10 a.m., and at any adjournments or postponements.

If the enclosed form of proxy is properly executed and returned to
ElderTrust in time to be voted at the annual meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon.
Executed but unmarked proxies will be voted FOR the election of the board of
trustees' two nominees as trustees. If any other matters are properly brought
before the annual meeting, the persons named in the accompanying proxy will vote
the shares represented by such proxies on such matters as determined by a
majority of the board of trustees of ElderTrust. The presence of a shareholder
at the annual meeting will not automatically revoke such shareholder's proxy.
Shareholders may, however, revoke a proxy at any time prior to its exercise by
filing with the secretary of ElderTrust a written revocation or a duly executed
proxy bearing a later date or by attending the annual meeting and voting in
person.

The cost of solicitation of proxies in the form enclosed herewith will
be borne by ElderTrust. In addition to the solicitation of proxies by mail,
ElderTrust, through its trustees, officers and regular employees, may also
solicit proxies personally or by telephone or telegraph. ElderTrust will also
request persons, firms and corporations holding shares in their names, or in the
name of their nominees, to send proxy material to and obtain proxies from
beneficial owners and will reimburse such holders for their reasonable expenses
in so doing. It is anticipated that this proxy statement will be mailed to
stockholders on or about April 28, 2000.

The securities which can be voted at the annual meeting consist of
common shares of beneficial interest of ElderTrust, par value $.01 per share.
Each share entitles its owner to one vote on all matters. The declaration of
trust of ElderTrust does not provide for cumulative voting in the election of
trustees. The board of trustees has fixed the close of business on March 17,
2000 as the record date for determination of shareholders entitled to vote at
the annual meeting. The number of common shares outstanding on the record date
was 7,119,000.

The presence, in person or by proxy, of at least a majority of the
outstanding common shares is necessary to constitute a quorum at the annual
meeting. Shareholders' votes will be tabulated by the persons appointed by the
board of trustees to act as inspectors of election for the annual meeting.
Abstentions and broker non-votes will be treated as shares that are present, in
person or by proxy, and entitled to vote for purposes of determining the
presence of a quorum at the annual meeting. Abstentions and broker non-votes
will not be counted as a vote cast on any matter presented at the annual
meeting.

A copy of ElderTrust's 1999 annual report to shareholders accompanies
this proxy statement. The 1999 annual report to shareholders includes
ElderTrust's annual report on Form 10-K for the year ended December 31, 1999 as
filed with the SEC. Shareholders may obtain a copy of the exhibits to ElderTrust
1999 annual report on Form 10-K, upon payment of a reasonable fee, by writing to
ElderTrust, 101 East State Street, Suite 100, Kennett Square, Pennsylvania
19348, Attention: Corporate Secretary.

ELECTION OF TRUSTEES
(Proposal 1)

The declaration of trust of ElderTrust provides for a minimum of three
trustees and a maximum of nine trustees. The board of trustees of ElderTrust
currently consists of four members. The trustees are divided into three classes,
each consisting of approximately one-third of the total number of trustees. The
term of office of only one class expires in each year and their successors are
elected for terms of three years and until their successors are elected and
qualified. At the annual meeting, two trustees will be elected for a three-year
term. As described below, the board of trustees' nominees are D. Lee McCreary,
Jr. and Rodman W. Moorhead, III. The board of trustees recommends that you vote
FOR the board of trustees' nominees for election as trustees.

Unless otherwise specified on the proxy, it is the intention of the
persons named in the proxy to vote the shares represented by each properly
executed proxy for the election as trustees of Mr. McCreary and Mr. Moorhead,
each for a three-year term. The board of trustees believes Mr. McCreary and Mr.
Moorhead will stand for election and will serve if elected as trustees. However,
if they fail to stand for election or are unable to accept election, the proxies
will be voted for the election of such other persons as a majority of the board
of trustees of ElderTrust may recommend. Trustees are elected by plurality vote.

Information as to Nominees and Other Trustees

The following table sets forth certain information regarding the board
of trustees' nominees for election as trustee and those trustees who will
continue to serve as such after the annual meeting.

Age at Position(s) Held
March 31, Trustee For Term with
2000 Since To Expire ElderTrust
Nominees:

D. Lee McCreary, Jr..................... 42 1999 2003 President, Chief
Rodman W. Moorhead, III................. 56 1998 2003 Trustee

Continuing Trustees: Term Expires

John G. Foos............................ 50 2000 2002 Trustee

Michael R. Walker....................... 51 1997 2001 Chairman of the Board

The principal occupations for the past five years of the nominees for
trustee and the trustee whose term of office will continue after the annual
meeting are set forth below.

D. Lee McCreary, Jr., a trustee of ElderTrust since October 1999, is
the president, chief executive officer, chief financial officer, treasurer and
secretary of ElderTrust. In June 1997, Mr. McCreary became senior vice
president, chief financial officer, treasurer and secretary of ElderTrust Realty
Group, Inc., predecessor to ElderTrust. In July 1999, he was named acting
president and chief executive officer and was appointed to those positions on a
permanent basis and as a trustee of ElderTrust in October 1999. From September
1994 until May 1997, Mr. McCreary was vice president-tax services at Siegfried,
Schieffer & Seitz, a Wilmington, Delaware-based regional accounting firm. Before
joining Siegfried, Schieffer & Seitz, he was a partner at Price Waterhouse LLP,
where he worked for over 14 years providing tax consulting services for
companies in the healthcare, real estate and financial services industries. Mr.
McCreary is a member of both the American Institute of Certified Public
Accountants and the Maryland Association of Certified Public Accountants. He
holds a bachelor of science degree from the University of Delaware.

Rodman W. Moorhead, III, a trustee of ElderTrust since January 1998,
has been employed since 1973 by E.M. Warburg, Pincus & Co., LLC, a specialized
financial services firm in New York, where he currently serves as senior
managing director. He is a director of Coventry Corporation, a multi-market
health maintenance organization, NeXstar Pharmaceuticals, Inc., a novel human

therapy and drug delivery company, Transkaryotic Therapies, Inc., a gene therapy
company, Xomed Surgical Products, a surgical sponge and wound care products
company and several private companies. He is a trustee of The Taft School and a
member of the overseers' committee on university resources, Harvard College. Mr.
Moorhead holds a master of business administration degree from the Harvard
Business School and a bachelor of arts in economics degree from Harvard
University.

John G. Foos, a trustee of ElderTrust since April 2000, has served
since July 1989 as chief financial officer of Independence Blue Cross, the
largest health insurer in the Philadelphia, Pennsylvania region. Before joining
Independence Blue Cross, Mr. Foos was a partner with the public accounting firm
of KPMG LLP. Mr. Foos is a member of the board of directors of HoosierCare,
Inc., a tax-exempt organization that owns and operates 16 long-term care
facilities in the east and midwest. Mr. Foos is a member of the American
Institute of Certified Public Accountants and the Pennsylvania Institute of
Certified Public Accountants. He holds a bachelor of science degree in
accounting from Susquehanna University.

Michael R. Walker is chairman of the board of trustees of ElderTrust.
Mr. Walker also serves as the chairman and chief executive officer of Genesis
Health Ventures, Inc. ("Genesis"), positions which he has held since he founded
Genesis in 1985. In 1981, Mr. Walker co-founded Health Group Care Centers. At
Health Group Care Centers, he served as chief financial officer and, later, as
president and chief operating officer. Before its sale in 1985, Health Group
Care Centers operated nursing homes with 4,500 nursing beds in 12 states. From
1978 to 1981, Mr. Walker was the vice president and treasurer of AID Healthcare
Centers, Inc. AID Healthcare Centers, which owned and operated 20 nursing
centers, was co-founded in 1977 by Mr. Walker as the nursing home division of
Hospital Affiliates International. Mr. Walker holds a master of business
administration degree from Temple University and a bachelor of arts in business
administration degree from Franklin and Marshall College.

Executive Officers Who are Not Trustees

John H. Haas, age 51, was named vice president and chief operating
officer of ElderTrust in February 2000. From May 1998 to January 2000, Mr. Haas
served as a consultant to ElderTrust. From 1994 to 1998, Mr. Haas was the vice
president, secretary and general counsel of Senior Campus Living, LLC, a
continuing care retirement community developer and operator. He previously
served of counsel to the Baltimore-based law firm of Hodes, Ulman, Pessin &
Katz, and earlier, as executive vice president and chief operating officer of
McCormick Properties, Inc. before its sale by its parent, McCormick & Company,
Inc., the specialty food and spice company. Mr. Haas has served as an adjunct
instructor in the Masters of Science in Real Estate at Johns Hopkins University
and has taught seminars for commercial real estate lenders, the Maryland
National Park and Planning Commission and the General Services Administration.
He holds a juris doctor degree from the University of Baltimore School of Law
and a bachelor of arts degree from the University of Connecticut.

Board Meetings and Committees

During 1999, the board of trustees of ElderTrust held six regular
meetings and three special meetings. For the 1999 period, no trustee attended
less than 75 percent of the (A) total number of meetings held by the board of
trustees and (B) total number of meetings held by all committees of the board of
trustees on which the trustee served. ElderTrust has the following board
committees:

Audit Committee. Mr. Moorhead currently is the sole member of the audit
committee. The audit committee has the authority (A) to make recommendations
concerning the engagement of the independent auditor, (B) to review with the
independent auditors the plans and results of the audit engagement, (C) to
review the independence of the independent public accountants, (D) to approve
professional services provided by the independent public accountants, (E) to
consider the range of audit and non-audit fees and (F) to review the adequacy of
ElderTrust's internal accounting controls. The audit committee held four
meetings during 1999.

Compensation and Share Option Committee. The current members of the
compensation and share option committee are Messrs. Walker and Moorhead, who are
both non-employee trustees. The compensation and share option committee has the
authority (A) to determine compensation for ElderTrust's executive officers, (B)
to review and make recommendations concerning proposals by management with
respect to compensation, bonuses, employment agreements and other benefits and
policies for ElderTrust's executive officers and (C) to take all actions and
make all determinations, including the grant of options, distribution equivalent
rights and share awards, under ElderTrust's share option and incentive plans.
The compensation and share option committee held three meetings during 1999.

Nominations by Shareholders

The entire board of trustees acts as a nominating committee for
selecting the board of trustees' nominees for election as trustees and has made
its nominations for the annual meeting. The bylaws of ElderTrust require that
shareholder nominations for trustees be made pursuant to timely notice in
writing to the secretary of ElderTrust. To be timely, notice must be delivered
to the principal executive offices of ElderTrust not later than the close of
business on the 60th day nor earlier than the close of business on the 90th day
prior to the first anniversary of the preceding year's annual meeting. However,
if the date of the annual meeting is advanced by more than 30 days or delayed by
more than 60 days from such anniversary date, notice by the shareholder to be
timely must be delivered not earlier than the close of business on the 90th day
prior to the annual meeting and not later than the close of business on the
later of the 60th day prior to the annual meeting or the tenth day following the
day on which public announcement of the date of the annual meeting is first made
by ElderTrust. A shareholder's notice of nomination must set forth certain
information specified in ElderTrust's bylaws concerning each person the
shareholder proposes to nominate for election and the nominating shareholder.
Under the bylaws, shareholder nominations for the annual meeting were required
to be received not later than the close of business on February 18, 2000 nor
earlier than the close of business on January 20, 2000. No such nominations were
received. ElderTrust's bylaws provide that no person may be elected as a trustee
unless nominated in accordance with the procedures set forth in the bylaws.

Compensation of Trustees

ElderTrust reimburses the trustees for travel expenses incurred in
connection with attending meetings of the board of trustees and committee
meetings. Instead of trustees' fees, Mr. Moorhead and each of the other
non-employee trustees then serving on the board, other than Mr. Walker, received
a share bonus award of 2,500 common shares in January 1998. Mr. Moorhead and
each of the other non-employee trustees then serving on the board, other than
Mr. Walker, also received a ten-year share option grant of 7,500 common shares,
which vest over three years. The option exercise prices of these options equaled
the $18.00 initial public offering price of ElderTrust common shares. In
connection with ElderTrust's January 1998 initial public offering, Mr. Walker
was granted an option for 150,000 common shares at a per share exercise price
equal to the $18.00 initial public offering price. These options also vest over
three years.

The vesting of options granted to non-employee trustees will accelerate
upon a change in control of ElderTrust. For this purpose, a change in control of
ElderTrust includes (A) a person becoming the beneficial owner of 50% or more of
the voting power of the outstanding securities of ElderTrust, (B) a change in a
majority of the board of trustees during any two-year period other than
resulting from mandatory retirement, death or disability of one or more
trustees, (C) a merger or consolidation of ElderTrust if shareholders of
ElderTrust own less than 80% of the equity of the surviving entity or its
parent, (D) the sale of all or substantially all of the assets of ElderTrust,
(E) any person commences a tender offer to acquire beneficial ownership of 50%
or more of the outstanding voting shares of ElderTrust unless the board of
trustees determines that such action does not constitute a change in control or
(F) a change of control of ElderTrust of a type required to be disclosed under
the federal proxy rules.

Effective January 1, 2000, non-employee trustees of ElderTrust receive
a $10,000 annual retainer, a $1,000 attendance fee for regularly scheduled board
meetings and a $500 attendance fee for committee meetings and special meetings
of the board. Non-employee trustees also receive annual grants of distribution
equivalent rights and share options for a total of 10,000 common shares each.

EXECUTIVE COMPENSATION AND OTHER INFORMATION

Summary of Cash and Other Compensation

The following table sets forth the cash and other compensation paid by
ElderTrust for 1999, 1998 and 1997 to each person who served as an executive
officer of ElderTrust during 1999.

Summary Compensation Table
Long-Term
Annual Compensation Compensation/
Awards
---------------------- ---------------------
Common Shares All Other
Name and Principal Position(s) Underlying Compensation
Year Salary ($) Options (#) ($)
- ------------------------------- -------- ---------------------- --------------------- ---------------------

D. Lee McCreary, Jr. 1999 $ 162,700 225,000 $ 58,200 (1)
President, Chief 1998 125,400 50,000 27,500
Executive Officer, 1997 70,000 (2) -- 216,000
Chief Financial
Officer, Treasurer and
Secretary

Edward B. Romanov, Jr. 1999 151,900 -- 2,635,300 (4)
President and Chief 1998 248,800 300,000 37,600
Executive Officer (3) 1997 164,000 (2) -- 2,137,500

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

(1) Represents (a) $54,200 earned on distribution equivalent rights for a total
of 40,000 common shares held by Mr. McCreary at December 31, 1999 and (b)
1999 contributions of $4,000 made by ElderTrust to Mr. McCreary's account
under the Simple IRA Retirement Plan maintained by ElderTrust for its
employees.

(2) Represents the portion of the executive officer's salary allocable to
ElderTrust that was paid by Genesis in 1997. ElderTrust reimbursed Genesis
for these amounts using a portion of the net proceeds from ElderTrust's
initial public offering.

(3) Mr. Romanov resigned all positions with ElderTrust and its subsidiaries,
including as president and chief executive officer and as a trustee, on
July 29, 1999.

(4) Represents (a) $31,700 earned on distribution equivalent rights held by Mr.
Romanov, which amount was cancelled upon his termination of employment, (b)
1999 contributions of $3,600 made by ElderTrust to Mr. Romanov's account
under the ElderTrust Simple IRA Retirement Plan and (c) debt forgiveness of
$2.6 million. See "Romanov Separation Agreement and Release."

Option Grants

The following table contains information with respect to share options
granted in 1999 to each of ElderTrust's executive officers. All options granted
to executive officers in 1999 were ten-year non-qualified options.

Option Grants In Last Fiscal Year

% of Potential Realizable
Common Total Options Value at Assumed
Shares Granted to Exercise Annual Rates of Share
Underlying Employees in or Base Price Appreciation for
Options Fiscal Price Expiration Option Term
Name Granted (1) Year ($/Sh) Date 5% ($) 10% ($)
---- ----------- ---------- ------ ------------ ----------- ----------

D. Lee McCreary, Jr. 200,000 86% $6.69 10/13/09 $841,000 $2,132,000
25,000 11 5.31 12/14/09 84,000 212,000
Edward B. Romanov, Jr. - - - - - -

- ---------
(1) These options vest over three years. The vesting options will accelerate
upon any change in control of ElderTrust, as described under "Compensation of
Trustees."

Option Exercises and Holdings

The following table sets forth information concerning the number of
securities underlying unexercised options at the 1999 year-end and the 1999
year-end value of all unexercised in-the-money options held by ElderTrust's
executive officers. No executive officer exercised any options in 1999.

Aggregated Option Exercises in Last Fiscal Year and
Fiscal Year-End Option Values

Number of Common Shares
Underlying Value of Unexercised
Unexercised Options(#) In-the-Money Options($)
Name Exercisable Unexercisable Exercisable Unexercisable
--------------- ----------- ------------- ----------- -------------

D. Lee McCreary, Jr. 26,642 248,358 $ 8,125 $ 12,188
Edward B. Romanov, Jr. - - - -

Employment Agreement

ElderTrust has entered into an employment agreement with D. Lee
McCreary, Jr. dated October 13, 1999, under which Mr. McCreary serves as
ElderTrust's president and chief executive officer. The initial term of the
employment agreement is three years, subject to annual renewals commencing on
October 13, 2001, unless earlier terminated. Mr. McCreary's initial annual base
salary under the employment agreement is $200,000, effective July 29, 1999, when
he began serving as acting president and chief executive officer of ElderTrust.
The annual base salary is subject to increase on an annual basis by the board of
trustees. For 2000, Mr. McCreary's base salary will be $250,000. Mr. McCreary
also is entitled to receive incentive compensation in the form of share options
as determined by the compensation and share option committee of the board of
trustees.

Mr. McCreary's employment may be terminated by ElderTrust (a) upon 15
days' notice for cause by a two-thirds vote of the entire board of trustees or
(b) upon 90 days' notice without cause by a two-thirds vote of the entire board
of trustees. Mr. McCreary may terminate his employment on 90 days' notice if (a)
ElderTrust terminates by a two-thirds vote of the entire board of trustees the
automatic extension of the term of his employment agreement, (b) ElderTrust
assigns duties to him that are inconsistent with his status with ElderTrust or
substantially alters the nature or status of his responsibilities, (c)
ElderTrust reduces his base salary under his employment agreement, (d)
ElderTrust relocates his principal place of employment or relocates the
principal office or corporate headquarters to a location 35 miles or more from
his current principal place of employment, (d) there is a change in control of
ElderTrust, (e) a material failure on the part of ElderTrust to comply with any
of the provisions of the employment agreement, (f) any termination of his
employment for reasons other than death, disability or cause or the termination
by the board of trustees of the automatic extension of the term of his
employment agreement or (e) the commencement by of a proceeding seeking the
liquidation, reorganization, dissolution or winding-up of ElderTrust or its
subsidiaries or the appointment of a bankruptcy trustee or receiver for
ElderTrust or its subsidiaries.

If ElderTrust terminates Mr. McCreary's employment without cause, or
Mr. McCreary terminates his employment agreement as described above, Mr.
McCreary would be entitled to a severance payment equal to three times his
average annual base salary for the preceding three years, or, if less, over the
expired term of his employment agreement, plus the average annual value as of
the date of grant of his share options vesting in a fiscal year and the value of
his dividend equivalent rights credited to his account in the fiscal year
immediately preceding his termination, provided that the value attributed to
such share options and distribution equivalent rights shall not exceed 50% of
his average annual base salary for the three-year period preceding the
termination of his employment agreement. All share options, awards and similar
equity rights, if any, also would vest and become exercisable immediately prior
to his termination and remain exercisable through their original terms.
Following termination of his employment agreement for any reason, other than for
cause or upon Mr. McCreary's death, ElderTrust would maintain in full force and
effect, for the greater of two years or the remaining term of the employment
agreement, all employee benefit plans and programs to which Mr. McCreary was
entitled prior to his termination.

If Mr. McCreary becomes disabled for a period of twelve months or for
periods aggregating more than twelve months in any 24-month period, ElderTrust
may terminate Mr. McCreary's employment upon 30 days' notice and payment of any
unpaid portion of his salary, bonus and benefits up to the last day of the month
of his termination. Upon Mr. McCreary's death, his heirs would be entitled to
receive the unpaid portion of his salary, bonus and accrued benefits through the
last day of the month of his death. Upon the death or disability of Mr.
McCreary, all distribution equivalent rights and share options would become
fully vested.

Romanov Separation Agreement and Release

On July 29, 1999, ElderTrust, ElderTrust Operating Limited Partnership
(the "Operating Partnership") and Mr. Romanov entered into a separation
agreement and release. Under this agreement, Mr. Romanov resigned all positions
with ElderTrust and its subsidiaries, including as president and chief executive
officer and as a trustee of ElderTrust. In connection with Mr. Romanov's
resignation, the Operating Partnership cancelled $2.6 million of a total of $3.6
million of indebtedness owed by Mr. Romanov in connection with his January 1998
purchase in a private placement of 200,000 common shares from ElderTrust. The
Operating Partnership also reimbursed Mr. Romanov for $10,000 of attorney's fees
and expenses incurred by him in connection with the negotiation and execution of
the separation agreement and release. Mr. Romanov's January 1998 employment
agreement, pursuant to which he had previously served as president and chief
executive officer of ElderTrust, his common share options and his distribution
equivalent rights, and all rights, benefits, obligations and liabilities of the
parties thereunder (other than the provisions of his employment agreement
relating to employee discoveries), were terminated and cancelled concurrent with
his resignation. Mr. Romanov also agreed to transfer his controlling interests
in certain entities in which the Operating Partnership has an interest to Mr.
McCreary. ElderTrust, the Operating Partnership and Mr. Romanov also entered
into releases, as set forth in the separation agreement and release.

Under the separation agreement and release, Mr. Romanov also agreed
that he would not acquire beneficial ownership of any additional common shares
or other securities of ElderTrust, or any additional partnership interests or
other securities of ElderTrust Operating Limited Partnership, without the prior
written approval of the ElderTrust board of trustees. He also agreed that, until
July 29, 2005, neither he nor any of his affiliates would (a) call, or
participate in any manner in calling, a special meeting of shareholders of
ElderTrust or of the partners of the Operating Partnership, (b) submit any
proposal for voting upon at any annual or special meeting of shareholders of
ElderTrust or for a vote or consent of the partners of the Operating
Partnership, (c) propose any nominee for election as a trustee of ElderTrust, or
(d) institute, encourage or participate in any proxy solicitation with respect
to any matter submitted to a vote of ElderTrust's shareholders or the partners
of the Operating Partnership or seek to advise or influence any person or entity
with respect to the voting of common or preferred Shares or any other securities
of ElderTrust or the voting of partnership interests or any other securities of
the Operating Partnership. Further, at all meetings of shareholders of
ElderTrust held on or prior to July 29, 2005, Mr. Romanov agreed to vote or
direct the voting of his common shares for, against or abstain on each matter
voted on by shareholders in the same proportion as the common shares of
ElderTrust owned by all other shareholders are voted or abstained from voting
with respect to each matter. In each vote or consent of partners of the
Operating Partnership held on or prior to July 29, 2005, he also agreed to vote

or direct the voting of his units of beneficial interest for, against or abstain
on each matter voted on by partners of the Operating Partnership in the same
proportion as the partnership interests of the Operating Partnership owned by
all other partners of the Operating Partnership (including ElderTrust) are
voted, except for matters requiring the consent of the outside limited partners,
as to which his units would be voted in the same proportion as how the
partnership interests held by all other partners of the Operating Partnership
(excluding ElderTrust) are voted.

Compensation Committee Interlocks and Insider Participation

During 1999, the members of the compensation and share option committee
of the board of trustees consisted of Mr. Moorhead and Timothy Weglicki, neither
of whom was an officer or employee of ElderTrust. Mr. Weglicki resigned as a
trustee effective January 31, 2000. Effective February 2, 2000, Mr. Walker was
re-appointed as a member of the compensation and share option committee. In
addition to serving as the chairman of the board of trustees of ElderTrust, Mr.
Walker serves as chairman of the board and chief executive officer of Genesis,
ElderTrust's principal tenant.

Transactions between ElderTrust and Genesis and Genesis Equity Investees

At December 31, 1999, ElderTrust, through the Operating Partnership,
leased eight properties to consolidated subsidiaries of Genesis under percentage
and minimum rent leases, each for an initial ten-year period with two five-year
renewals. In addition, six properties were leased under minimum rent leases to
entities in which Genesis accounts for its investment using the equity method of
accounting ("Genesis Equity Investees), each with an initial term of ten to
twelve years. Consolidated subsidiaries of Genesis also leased space under fixed
rent leases in three medical office and other buildings. The term of these
leases are for up to five years, subject to renewal. Finally, a consolidated
subsidiary of Genesis managed one skilled nursing facility leased to an
unrelated third party. ElderTrust received lease payments of $14.7 million in
1999 on properties leased to or managed by consolidated subsidiaries of Genesis
or Genesis Equity Investees.

At December 31, 1999, the Operating Partnership had four term loans and
two construction loans totaling $34.3 million made in 1998 to consolidated
subsidiaries of Genesis, including two term and one construction loan made to
subsidiaries of The Multicare Companies, Inc. ("Multicare"). These loans had
original maturities of between two and three years, subject to extension by the
borrower for up to four successive one-year terms, with a weighted average
interest rate of 10.0%. The largest aggregate amount of indebtedness outstanding
at any time during 1999 was $34.3 million. The Operating Partnership recorded
interest income on these loans of $3.3 million in 1999. See "Proposed Loan
Restructurings and Related Matters" for additional information.

Additionally, at December 31, 1999, the Operating Partnership had one
term loan totaling $4.8 million with a Genesis Equity Investee. The term loan
had an original maturity of two years, subject to extension by the borrower for
one one-year term, with an interest rate of 9.5%. The largest aggregate amount

of indebtedness outstanding at any time during 1999 was $4.8 million. The
Operating Partnership recorded interest income on this loan of $412,000 in 1999.
See "Proposed Loan Restructurings and Related Matters" for additional
information.

Other Transactions between ElderTrust and its Equity Investees and
Genesis and Genesis Equity Investees

ET Sub-Meridian Limited Partnership, L.L.P. ElderTrust, through the
Operating Partnership, has a 99% limited partnership interest in ET Sub-Meridian
Limited Partnership, L.L.P. ("ET Sub-Meridian"). The 1% general partner interest
is owned by a limited liability company of which Mr. McCreary is the sole
member. ET Sub-Meridian owns the leasehold and purchase option rights to seven
skilled nursing facilities located in Maryland and New Jersey, which it
purchased from Genesis for $35.5 million in cash and issuance of $8.5 million in
term loans during September 1998. ElderTrust guaranteed the $8.5 million
promissory note of ET Sub-Meridian payable to Genesis. The purchase options are
exercisable by ET Sub-Meridian in September 2008 for a cash exercise price of
$66.5 million. At December 31, 1999, ET Sub-Meridian had a $17.6 million
subordinated demand loan bearing interest at 12% per annum payable to ElderTrust
in connection with the above transaction. The largest aggregate amount of
indebtedness outstanding on the note payable from ET Sub-Meridian at any time
during 1999 was $17.6 million.

At December 31, 1999, ET Sub-Meridian subleased these seven properties
to subsidiaries of Genesis under minimum rent leases, each for an initial
ten-year period with a ten-year renewal option. ET Sub-Meridian received
sublease payments of $9.8 million in 1999 from these subsidiaries of Genesis.

ElderTrust recorded $2.1 million in interest income for the year ended
December 31, 1999 on the note payable from ET Sub-Meridian. ElderTrust also
recorded a loss of $2.3 million related to the portion of its equity interest in
ET Sub-Meridian's results of operations for the year ended December 31, 1999.

ET Sub-Heritage Andover, LLC
ET Sub-Vernon Court, LLC
ET Sub-Cabot Park, LLC
ET Sub-Cleveland Circle, LLC

ElderTrust, through four limited liability companies (ET Sub-Heritage
Andover, LLC, ET Sub-Vernon Court, LLC, ET Sub-Cabot Park, LLC, and ET
Sub-Cleveland Circle, LLC), has member interests in three assisted living
facilities and one independent living facility, which it acquired during
December 1998 from an unrelated third party. A Genesis Equity Investee leases
each of the facilities.

ElderTrust is the sole member of ET Sub-Heritage Andover, LLC, which,
accordingly, is consolidated into ElderTrust's consolidated financial statements
at December 31, 1999. In each of the remaining three limited liability
companies, ElderTrust has a 99% member interest. The 1% managing member interest

in these three companies is owned by a limited liability company of which Mr.
McCreary is the sole member. ElderTrust currently has the option to acquire the
1% managing member interest in ET Sub-Vernon Court, LLC from Mr. McCreary. The
option exercise price is $3,200. As ElderTrust has the ability to acquire the 1%
managing member interest in ET Sub-Vernon Court, LLC for a nominal amount, this
company is consolidated into ElderTrust's consolidated financial statements at
December 31, 1999.

At December 31, 1999, ET Sub-Cabot Park, LLC and ET Sub-Cleveland
Circle, LLC, equity investees of ElderTrust, each leased one property to a
Genesis Equity Investee under a minimum rent lease, with an initial term of ten
years and a ten-year renewal option. ET Sub-Cabot Park, LLC and ET Sub-Cleveland
Circle, LLC received aggregate lease payments of $3.0 million in 1999 from
Genesis Equity Investees.

ElderTrust recorded an aggregate loss of $401,000 related to the
portion of its equity interest in ET-Sub-Cabot Park, LLC's and ET Sub-Cleveland
Circle, LLC's results of operations for the year ended December 31, 1999.

Genesis and Multicare Commence Debt Restructuring Discussions

On March 21, 2000, Genesis and Multicare announced the beginning of
debt restructuring discussions with their senior lenders with the intention of
revising their respective capital structures. Genesis also announced that it did
not make a $3.8 million interest payment to its senior debt lenders due March
20, 2000. Both Genesis and Multicare announced their intention not to make
interest and principal payments on senior debt and have been prohibited by their
senior lenders from making any scheduled interest payments on their publicly
traded subordinated debt while discussions were ongoing. Each company cited
their inability to sell assets due to the lack of long-term care market
financing and the continuing effect of reduced Medicare payments as the causes
of these actions. The senior lenders have given Genesis and Multicare a 60-day
forbearance period to develop a restructuring plan. Management of Genesis and
Multicare have advised ElderTrust that they expect Genesis and Multicare to
continue to make all lease and loan payments to ElderTrust. ElderTrust has no
control over Genesis or Multicare, however, and can make no assurance that
either of these entities will have sufficient income or assets to enable them to
satisfy their obligations under the leases or loans made by ElderTrust to them.

Proposed Loan Restructurings and Related Matters

ElderTrust previously was obligated to purchase and leaseback, upon the
maturity of the related loan or the facility reaching stabilized occupancy, five
assisted living facilities (Mifflin, Coquina Place, Lehigh, Berkshire and Harbor
Place) under term loans and two assisted living facilities (Oaks and Sanatoga)
under construction loans made by the Company in January 1998. Of these seven
loans, which had an aggregate principal balance at December 31, 1999 of $39.1
million, three loans (Mifflin, Coquina Place and Oaks), were made to
wholly-owned subsidiaries of Genesis, three loans (Lehigh, Berkshire and
Sanatoga), were made to wholly-owned subsidiaries of Multicare and one loan
(Harbor Place) was made to a Genesis Equity Investee. ElderTrust believes it is
no longer bound by the purchase and leaseback obligations contained in the loan
documents because the borrowers have, from time to time, not complied with all
loan provisions.

ElderTrust and the borrowers have extended the maturity date of the
five term loans through April 28, 2000 to permit them to negotiate and document
a proposed restructuring of the relationships among the parties. Under the
proposed restructuring, ElderTrust would acquire the Lehigh, Berkshire and
Sanatoga facilities in exchange for the release of ElderTrust's loans to the
subsidiaries of Multicare. ElderTrust would then net lease these properties to
subsidiaries of Genesis for an initial lease term of 14 years, with three
five-year renewal options. In addition, the maturity date on the loans for
Mifflin, Coquina Place, Oaks and Harbor Place would be extended to April 1,
2001.

As part of the proposed restructuring, ElderTrust also would transfer
to Genesis the Company's Phillipsburg skilled nursing facility and certain other
assets in exchange for the improvements Genesis is making on the Company's
Rittenhouse skilled nursing facility. The existing Rittenhouse lease would be
amended to, among other things, increase the annual rent to an amount which
equals the sum of the annual rents on the current separate leases for
Phillipsburg and Rittenhouse. In addition, the Heritage Woods percentage rent
lease would be converted into a minimum rent lease, and the Willowbrook lease
would be set permanently as a minimum rent lease. Finally, if Genesis refinances
the Oaks, Harbor Place, Coquina and Mifflin loans with a third party and does
not receive sufficient loan proceeds to cover the existing loan balances, and
once the Credit Facility is fully repaid, the parties would agree that any
shortfall would be applied against amounts owed by an equity investee of
ElderTrust to Genesis under an $8.5 million note given to Genesis as part of the
purchase price for interests in seven properties acquired from Genesis in 1998.

The proposed restructuring is subject to approval by the Boards of
ElderTrust, Genesis and Multicare and by each company's principal lenders. No
assurance can be given that the proposed restructurings will be completed.

Performance Graph

The following graph compares the cumulative total shareholder return on
ElderTrust's common shares since January 27, 1998, the date ElderTrust's common
shares began trading on the New York Stock Exchange, with the cumulative total
shareholder return from January 27, 1998 through December 31, 1999 of (A) the
NAREIT Equity REIT Index for all REITs and (B) the NAREIT Health Care Equity
REIT Index. The comparison assumes $100 was invested on January 27, 1998 in
ElderTrust's common shares and in each of the indices and assumes reinvestment
of distributions.

[GRAPHIC OMITTED]

NAREIT NAREIT
Equity REIT Index (all Health Care Equity REIT
REITs) Index ElderTrust
-------------------------- ------------------------- -----------------

January 27, 1998 $100 $100 $100
December 31, 1998 85 83 69
December 31, 1999 81 63 46

Report on Executive Compensation

The compensation and share option committee makes compensation
decisions for ElderTrust's executive officers and administers the ElderTrust
share option and incentive plans. ElderTrust's compensation policies and
practices with respect to executive officers are designed and implemented to
motivate and retain senior executives. Total compensation is currently divided
into two primary components: base salary and share options and distribution
equivalent rights.

ElderTrust uses its share option and incentive plans as a long-term
incentive plan for executive officers and key employees. The objectives of the
share option and incentive plans are to align the long-term interests of
executive officers and shareholders by creating a direct link between executive
compensation and shareholder return, and to enable executives to develop and
maintain a long-term equity interest in ElderTrust.

Before July 29, 1999, Mr. McCreary served as ElderTrust's Senior Vice
President, Chief Financial Officer, Treasurer and Secretary. His base salary as
of January 1, 1999 of $140,000 was approved by the compensation and share option
committee during 1998. Effective July 29, 1999, Mr. McCreary was named acting
president and chief executive officer of ElderTrust. On October 13, 1999, upon
his appointment as president and chief executive officer on a permanent basis
and as a trustee of ElderTrust, Mr. McCreary's base salary was increased to
$200,000 per year, effective July 29, 1999, and he was granted an additional
option for 200,000 common shares and awarded distribution equivalent rights for
an additional 10,000 common shares. On December 14, 1999, Mr. McCreary was
granted an additional option for 25,000 common shares. The per share option
exercise price of all options granted to Mr. McCreary during 1999 equaled the
fair market value of ElderTrust common shares on the date of grant. The
compensation and share option committee believes Mr. McCreary's compensation is
commensurate with his duties and responsibilities as ElderTrust's president and
chief executive officer and the significant contributions he made during 1999 to
the extension of the bank's credit facility and paydown of the outstanding
balance of the credit facility from approximately $100 million to $40 million at
the end of 1999.

Generally, Section 162(m) of the Internal Revenue Code of 1986, as
amended, denies deduction to any publicly held company, such as ElderTrust, for
certain compensation exceeding $1,000,000 paid to the chief executive officer
and the four other highest paid executive officers. The compensation and share
option committee intends to evaluate to what extent Section 162(m) applies to
its compensation decisions.

Respectfully submitted,

Compensation and Share Option Committee

Michael R. Walker
Rodman W. Moorhead, III

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires
ElderTrust trustees, officers and beneficial owners of more than 10% of
ElderTrust's outstanding equity securities to file with the SEC initial reports
of ownership of ElderTrust's equity securities and to file subsequent reports
when there are changes in such ownership. Based on a review of reports submitted
to ElderTrust for 1999, ElderTrust believes that all Section 16(a) filing
requirements for that year applicable to such persons were complied with on a
timely basis.

Certain Relationships and Related Transactions

The Operating Partnership has a nonvoting 95% equity interest in ET
Capital Corp. ("ET Capital"). The remaining voting 5% equity interest in ET
Capital is owned by Mr. McCreary. Messrs. Walker and McCreary serve as the
directors of ET Capital. Mr. McCreary is president, secretary and treasurer of
ET Capital. Mr. McCreary acquired his interest in ET Capital during 1999 from
Mr. Romanov for $141,000. As of December 31, 1999, ET Capital owned a $7.8
million second trust mortgage note executed by AGE Institute of Florida, which
it acquired from Genesis during 1998. This note is secured by a second lien on
11 Florida skilled nursing facilities owned by AGE Institute of Florida and a
second lien on accounts receivable and other working capital assets. The
facilities are managed by subsidiaries of Genesis. This note matures on
September 30, 2008 with payments of interest only, at a fixed annual rate of 13%
due quarterly until the note is paid in full. ET Capital recorded interest
income on the note of $1.0 million during 1999. The borrower made all required
interest payments during 1999 in accordance with the terms of the note.

In September 1999, the senior lender on the $40.0 million first trust
mortgage to the AGE Institute of Florida, which is guaranteed by Genesis,
notified the borrower that it was in default of the loan due to the borrowers'
failure to meet certain financial covenants. In November 1999, ET Capital
notified the borrower that it was in default of the $7.8 million second trust
mortgage loan held by ET Capital because of the default in the $40.0 million
first trust mortgage loan. Subsequently, the senior lender extended the maturity
date of the first mortgage trust loan from September 30, 1999 to March 28, 2000
to permit the AGE Institute of Florida time to obtain refinancing of the loan. A
letter agreement dated December 22, 1999 made certain modifications and defined
certain rights of the senior lender and ET Capital related to their respective
loans to the AGE Institute of Florida. The AGE Institute of Florida has been
working to obtain replacement financing of the $40.0 million first trust
mortgage loan and is seeking a further extension of the loan maturity date from
the senior lender.

ElderTrust understands from the AGE Institute of Florida that it is
continuing to pursue tax-exempt and other financing sources to refinance the
first and second trust mortgages. If the AGE Institute of Florida is unable to
refinance the $40.0 million first trust loan, or is otherwise unable to reach
acceptable extension terms with the senior lender, the senior lender may take
actions to recover its investment in such first trust loan. ET Capital has no
control over the actions of the senior lender and such actions could be
unfavorable to ET Capital.

ET Capital's long-term debt includes two demand promissory notes
payable to the Company aggregating $5.9 million at December 31, 1999 in
connection with the above second mortgage note transaction. These notes bear
interest at a weighted average rate of 12.1% per annum with interest only
payable quarterly. In addition, ET Capital has loans payable to the Company
aggregating $3.7 million, bearing interest at 15% and maturing at various dates
from April 2008 to December 2011. The largest aggregate amount of indebtedness
outstanding on the notes payable from ET Capital at any time during 1999 was
$9.6 million.

ElderTrust recorded $1.3 million in interest income for the year ended
December 31, 1999 on the notes payable from ET Capital. ElderTrust also recorded
income of $236,000 related to the portion of its equity interest in ET Capital's
results of operations for the year ended December 31, 1999.

Mr. McCreary, through a limited liability company of which he is the
sole member, owns a 1% general partner interest in ET Sub-Meridian. He also
indirectly owns the 1% managing member interests in three of the limited
liability companies formed to acquire properties from National Development of
New England, an unrelated third party. Mr. McCreary acquired his interests in
these four companies during 1999 from Mr. Romanov for an aggregate price of
$28,716. The Operating Partnership has an option to acquire Mr. McCreary's
interest in one of the limited liability companies for an exercise price of
$3,200. The Operating Partnership also has the right to acquire Mr. McCreary's
interests in the remaining entities at fair market value upon any termination of
his employment as an officer of ElderTrust.

For a description of other transactions involving ElderTrust and its
trustees, see "Compensation Committee Interlocks and Insider Participation."

SECURITIES OWNED BY MANAGEMENT

The following table sets forth certain information with respect to
beneficial ownership of ElderTrust common shares, including common shares that
may be issued in exchange for units of limited partnership of the Operating
Partnership presented for redemption and upon exercise of options exercisable
within 60 days, for each trustee and executive officer of ElderTrust and all
trustees and executive officers as a group. The information is as of March 17,
2000. Except as indicated below, each person has sole voting and investment
power.

Units of
Limited
Partnership Percent of
Number of of the Common All
Common Operating Share Common
Name of Beneficial Owner Shares Partnership Options Total Shares
------------------------ --------- ----------- ------- ----- ----------

Michael R. Walker (1) 150,500 318,975 100,000 569,475 7.6%
D. Lee McCreary, Jr. 33,703 12,000 54,306 100,009 1.3
Rodman W. Moorhead, III 37,500 - 5,625 43,125 *
John G. Foos 1,500 - - 1,500 *
John H. Haas - - - - -
All trustees and executive officers as
a group (5 persons) 223,203 330,975 159,931 714,109 9.4

- -------------------------
* Less than one percent.
(1) See "Principal Holders of Voting Securities."

PRINCIPAL HOLDERS OF VOTING SECURITIES

The following table sets forth information as of March 17, 2000 with
respect to the ownership of ElderTrust common shares by each person believed by
management to be the beneficial owner of more than five percent of ElderTrust's
outstanding common shares. The information is based on the most recent Schedule
13D filed with the SEC on behalf of such persons or other information made
available to ElderTrust. Except as otherwise indicated, the reporting persons
have stated that they possess sole voting and sole dispositive power over the
entire number of shares reported.

Name and Address of Amount and Nature of Percent of Common
Beneficial Owner Beneficial Ownership Shares Outstanding
- ---------------- -------------------- ------------------

Michael R. Walker (1) 569,475 7.6%
c/o ElderTrust
101 East State Street
Kennett Square, PA 19438

Edward B. Romanov, Jr. 489,350 6.8%
Centennial Barn
26 Cafferty Road
Pipersville, PA 18947

- ----------------------
(1) See "Securities Owned by Management."

(2) Includes 370,600 common shares and 118,750 units of limited partnership of
the Operating Partnership, which are redeemable on a one-for-one basis into
common shares of ElderTrust at Mr. Romanov's election at any time on or
prior to January 29, 2001 and thereafter for cash or, at the election of
ElderTrust, ElderTrust common shares. The voting of these securities is
subject to certain restrictions. See "Romanov Separation Agreement and
Release."

INDEPENDENT PUBLIC ACCOUNTANTS

The board of trustees has appointed KPMG LLP to act as the Company's
independent public accountants for 2000. Representatives of KPMG LLP will be
present at the annual meeting. They will be given an opportunity to make a
statement if they desire to do so and will be available to respond to
appropriate questions.

DATE FOR SUBMISSION OF SHAREHOLDER PROPOSALS

Proposals of shareholders intended to be presented at the 2001 annual
meeting must be received by ElderTrust no later than December 29, 2000 pursuant
to the proxy soliciting rules of the SEC in order to be considered for inclusion
in ElderTrust's proxy statement and form of proxy relating to the 2001 annual
meeting. Nothing in this paragraph shall be deemed to require ElderTrust to
include in its proxy statement and proxy relating to the 2001 annual meeting any
shareholder proposal which may be omitted from its proxy materials pursuant to
applicable regulations of the SEC in effect at the time such proposal is
received.

Pursuant to ElderTrust's bylaws, any shareholder who intends to present
a proposal for action at the 2001 annual meeting also must delivered notice to
the principal executive offices of ElderTrust not later than the close of
business on March 26, 2001 nor earlier than the close of business on February
22, 2001; however, if the date of the 2001 annual meeting is advanced by more
than 30 days or delayed by more than 60 days from May 23, 2001, notice by the
shareholder to be timely must be delivered not earlier than the close of
business on the 90th day prior to the 2001 annual meeting and not later than the
close of business on the later of the 60th day prior to the 2001 annual meeting
or the tenth day following the day on which public announcement of the date of
the 2001 annual meeting is first made by ElderTrust.

OTHER BUSINESS TO BE TRANSACTED

The board of trustees does not know of any other matters to be
presented for action by the shareholders at the annual meeting. If, however, any
other matters not now known are properly brought before the meeting, the persons
named in the accompanying proxy will vote such proxy in accordance with the
determination of a majority of the board of trustees.

By Order of the Board of Trustees

/s/ D. Lee McCreary, Jr.
-----------------------------------
D. Lee McCreary, Jr.
President, Chief Executive
Officer, Chief Financial Officer,
Treasurer and Secretary

Kennett Square, Pennsylvania
April 28, 2000

ELDERTRUST
101 East State Street, Suite 100, Kennett Square, PA 19348
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS - MAY 23, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES

The undersigned shareholder of ElderTrust hereby appoints Michael R. Walker
and John H. Haas, and each of them, with full power of substitution, as proxies
to cast all votes, as designated below, which the undersigned shareholder is
entitled to cast at the 2000 annual meeting of shareholders to be held on May
23, 2000 at 10 a.m., local time, at 101 East State Street, Kennett Square, PA
19348, and at any adjournments, upon the following matters:

(Continued and to be signed on reverse side)

THIS PROXY WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED SHAREHOLDER. UNLESS
CONTRARY DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE
NOMINEES LISTED IN PROPOSAL 1 AND IN ACCORDANCE WITH THE RECOMMENDATIONS OF A
MAJORITY OF THE BOARD OF TRUSTEES AS TO OTHER MATTERS.

1. To elect two trustees each for three-year terms:
D. Lee McCreary, Jr. and Rodman W. Moorhead, III

FOR both nominees listed WITHHOLD AUTHORITY
above to vote for both nominees
listed above
[ ] [ ]

(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.)

2. As determined by a majority of ElderTrust's board of trustees, the
proxies are authorized to vote upon such other business as may properly come
before the meeting or any adjournments.

The undersigned shareholder hereby acknowledges receipt of the Notice of
Annual Meeting and Proxy Statement and hereby revokes any proxy or proxies
heretofore given. This proxy may be revoked at any time prior to its exercise.

If you receive more than one proxy card, please date, sign and return all
cards in the accompanying envelope.

Date:______________________________________

___________________________________________

___________________________________________
(Please date and sign here exactly as name
hereon. When signing as attorney,
administrator, trustee or guardian, give
full title as such; and when stock has been
issued in the name of two or more persons,
all should sign.)