UNITED STATES
                    SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C.   20549

                                FORM 10-Q
(Mark One)

      [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934
               For the quarterly period ended June 30, 2003

                                   or

   [  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                       SECURITIES EXCHANGE ACT OF 1934
                 For the transition period from _____ to _____

                   Commission File Number:  001-13807

                                ElderTrust
         (Exact name of registrant as specified in its charter)



           Maryland                                23-2932973
(State or other jurisdiction of                 (I.R.S. Employer
 incorporation or organization)              Identification Number)


      2711 Centerville Road, Suite 108, Wilmington, DE      19808
         (Address of principal executive offices)         (Zip Code)



                             (302) 993-1022
            (Registrants telephone number, including area code)

     Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

                    Yes __X__                 No _____

     Indicate by check mark whether the registrant is an accelerated
filer (as defined in Rule 12b-2 of the Exchange Act).

                    Yes  ____                 No __X__


     Indicate the number of shares outstanding of each of the issuers
classes of common stock, as of the latest practicable date:

                Class                    Outstanding at July 31, 2003
___________________________________     _______________________________
 Common shares of beneficial                       7,711,811
interest, $0.01 par value per share






                                ELDERTRUST
                                FORM 10-Q
                    FOR THE QUARTER ENDED JUNE 30, 2003

                            TABLE OF CONTENTS



PART I:	FINANCIAL INFORMATION                                Page

     Item 1. Financial Statements

          Condensed Consolidated Balance Sheets as of June
           30, 2003 (unaudited) and December 31, 2002.........     1

          Condensed Consolidated Statements of Operations for
           the six months ended June 30, 2003 and 2002
           (unaudited)........................................     2

          Condensed Consolidated Statements of Cash Flows for
           the six months ended June 30, 2003 and 2002
           (unaudited)........................................     3

          Notes to Unaudited Condensed Consolidated Financial
           Statements.........................................     4

     Item 2.  Managements Discussion and Analysis of Financial
              Condition and Results of Operations.............    10

     Item 3.  Quantitative and Qualitative Disclosures About
              Market Risk.....................................    25

     Item 4.  Controls and Procedures.........................    26

PART II:	OTHER INFORMATION

     Item 4.  Submission of Matters to a Vote of Security
              Holders.........................................    26

     Item 6.  Exhibits and Reports on Form 8-K................    27

SIGNATURES....................................................    28

EXHIBIT INDEX.................................................    29

                                   i



                    PART I - FINANCIAL INFORMATION

ITEM 1.  Financial Statements

                                ELDERTRUST
                   CONDENSED CONSOLIDATED BALANCE SHEETS
                    (in thousands, except share amounts)

                                                  June 30,
                                                    2003    December 31,
                                                (unaudited)     2002
                                                ------------------------
                       ASSETS
Assets:
  Real estate properties, at cost                 $303,535     $306,553
  Less accumulated depreciation and
   amortization of capital leases                  (48,832)     (44,921)
  Land                                              20,425       20,425
                                                ------------------------
     Net real estate properties                    275,128      282,057
  Property held for sale                                 -          926
  Cash and cash equivalents                          6,348        7,398
  Restricted cash                                   11,288       11,259
  Accounts receivable, net of allowance of $28
  and $16, respectively                                128          119
  Accounts receivable from unconsolidated entities       -           65
  Prepaid expenses                                     742          613
  Investment in and advances to unconsolidated
   entities, net of allowance of $1,292 at
   December 31, 2002                                     -        3,187
  Other assets, net of accumulated amortization
   and depreciation of $1,331 and $1,128,
   respectively                                        956        1,151
                                                ------------------------
                                                  $294,590     $306,775
                                                ========================

       LIABILITIES AND SHAREHOLDERS EQUITY

Liabilities:
  Guidance line                                   $      -     $  3,067
  Accounts payable and accrued expenses              1,250        1,441
  Accounts payable to unconsolidated entities            -           47
  Mortgages,  bonds, note payable and capital
   lease obligations                               201,612      205,896
  Notes payable to unconsolidated entities               -        3,844
  Other liabilities                                  6,254        6,267
                                                ------------------------
     Total liabilities                             209,116      220,562
                                                ------------------------

Minority interest                                    3,438        3,469

Shareholders equity:
  Preferred shares, $.01 par value; 20,000,000
   shares authorized; none outstanding
  Common shares, $.01 par value; 100,000,000
   shares authorized; 7,711,811 and 7,540,142
   shares issued and outstanding, respectively          77           75
  Capital in excess of par value                   122,156      121,988
  Deficit                                          (40,197)     (39,319)
                                                ------------------------
     Total shareholders equity                      82,036       82,744
                                                ------------------------
  Total liabilities and shareholders equity       $294,590     $306,775
                                                ========================


                See accompanying notes to unaudited condensed
                     consolidated financial statements.

                                   1



                               ELDERTRUST
             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                              (Unaudited)
                (in thousands, except per share amounts)


                                 Three Months Ended     Six Months Ended
                                      June 30,              June 30,
                                  2003       2002       2003      2002
                                 ---------------------------------------
Revenues:
  Rental                          $8,050   $4,618    $16,089    $9,254
  Interest                            69       70        134       144
  Interest from unconsolidated
   equity investees                    -      922          -     1,837
  Other income                         -       24          -       234
                                 ---------------------------------------
    Total revenues                 8,119    5,634     16,223    11,469
                                 ---------------------------------------

Expenses:
  Property operating expenses        314      285        607       713
  Interest expense, including
   amortization of deferred
   finance costs                   3,600    2,100      7,223     4,220
  Depreciation and amortization    2,614    1,491      5,226     2,982
  General and administrative         777      606      1,602     1,223
  Bad debt expense (recovery)          -        -       (894)       19
  Loss on impairment of assets     2,021        -      2,021         -
                                 ---------------------------------------
    Total expenses                 9,326    4,482     15,785     9,157
                                 ---------------------------------------
Net income (loss) before equity
 in losses of unconsolidated
 entities and minority interest   (1,207)   1,152        438     2,312

Equity in losses of
 unconsolidated entities, net          -     (546)         -    (1,066)
Minority interest                     43      (31)       (11)      (66)
                                 ---------------------------------------

Income (loss) from continuing
 operations                       (1,164)     575        427     1,180

Loss on discontinued operations,
 net of minority interest              -     (234)       (71)     (229)
                                 ---------------------------------------

Net income (loss)                ($1,164)    $341       $356      $951
                                 =======================================


Income (loss) Per Share
---------------------------------
Basic weighted average number of
 common shares outstanding         7,712    7,361      7,655     7,349

Basic income (loss) per share
 from continuing operations       ($0.15)   $0.08      $0.06     $0.16
Basic loss per share from
 discontinued operations               -  ( $0.03)    ($0.01)   ($0.03)
Basic net income (loss) per share ($0.15)   $0.05      $0.05     $0.13

Diluted weighted average number
 of common shares outstanding       7,712   7,705      7,716     7,692

Diluted income (loss) per share
 from continuing operations        ($0.15)   0.07      $0.06     $0.15
Diluted loss per share from
 discontinued operations                -  ($0.03)    ($0.01)   ($0.03)
Diluted net income (loss) per
 share                             ($0.15)  $0.04      $0.05     $0.12

Dividends declared per share            -       -      $0.16         -



               See accompanying notes to unaudited condensed
                    consolidated finncial statements.

                                    2


                                ELDERTRUST
               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (Unaudited)
                               (in thousands)


                                                      Six Months Ended
                                                          June 30,
                                                     ------------------
                                                       2003     2002
                                                     ------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                            $356     $951
  Adjustments to reconcile net income to net
   cash provided by operating activities:
    Depreciation and amortization                      5,438    3,300
    Bad debt expense (recovery)                         (894)      19
    Non cash option expense                                7        -
    Loss on sale of property, plant and equipment         37      250
    Loss on impairment of long-lived assets            2,021        -
    Minority interest and equity in losses from
     unconsolidated entities                               8    1,132
    Net changes in assets and liabilities:
      Accounts receivable and prepaid expenses            85      188
      Accounts payable and accrued expenses             (178)    (228)
      Deferred lease costs                                 -     (154)
      Other                                              (55)    (777)
                                                     ------------------
        Net cash provided by operating activities      6,825    4,681
                                                     ------------------


CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures                                  (304)    (184)
  Proceeds from affiliates                                 -      103
  Net change in restricted cash                          (42)     518
  Other, net                                             (19)       -
                                                     ------------------
        Net cash provided by (used in)
          investing activities                          (365)     437
                                                     ------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Principal payments under guidance line/bank
   credit facility                                    (3,067)  (4,050)
  Principal payments on mortgages and bonds
   payable                                            (3,276)    (642)
  Distributions to shareholders                       (1,234)       -
  Distributions to minority interests                    (47)       -
  Deferred financing cost                                (49)       -
  Stock options exercised                                163       14
  Other                                                    -      (41)
                                                     ------------------
       Net cash used in financing activities          (7,510)  (4,719)
                                                     ------------------

Net decrease in cash and cash equivalents             (1,050)     399
Cash and cash equivalents, beginning of period         7,398    2,676
                                                     ------------------
Cash and cash equivalents, end of period              $6,348   $3,075
                                                     ==================

Supplemental cash flow information:
   Cash paid for interest                             $6,995   $3,993
                                                     ==================


                See accompanying notes to unaudited condensed
                       consolidated financial statements.
                                    3


                                ELDERTRUST
                        NOTES TO UNAUDITED CONDENSED
                     CONSOLIDATED FINANCIAL STATEMENTS



     The accompanying unaudited condensed consolidated financial
statements of ElderTrust and its consolidated subsidiaries (ElderTrust
or the Company) should be read together with the consolidated financial
statements and notes thereto for the year ended December 31, 2002 included
in the Companys Annual Report on Form 10-K filed with the Securities and
Exchange Commission.

1.  Certain Significant Risks and Uncertainties

Liquidity

     The Company expects to meet its short-term liquidity requirements
generally through net cash provided by operations.  The Company believes
that its net cash provided by operations will be sufficient to allow the
Company to make distributions necessary to enable the Company to qualify
as a real estate investment trust for federal income tax purposes.

     On August 30, 2002, ElderTrust entered into the Guidance Line with
Wachovia Bank.  Funds provided under this agreement to the borrower,
ElderTrust Operating Limited Partnership (the Operating Partnership), of
approximately $3.1 million were used to pay off the then existing credit
facility, and to pay certain transaction and other costs.  On January 27,
2003, the Company paid $3.1 million to Wachovia Bank to pay off the
balance due under the Guidance Line.  As of June 30, 2003, the Company
has $7.5 million available to borrow, subject to lender approval and
borrowing base limitations.

     The Company had three non-recourse mortgage loans with an aggregate
principal balance of $30 million at December 31, 2002 that were scheduled
to mature in December 2002.  The Company announced in November 2002 that
the maturity date of one loan, secured by the Lopatcong property, had been
extended until December 1, 2004.  In February 2003, the lender also
extended a $4.6 million mortgage loan secured by the Wayne property to
December 1, 2004.  In connection with the extension, the Company made a
$1.1 million payment and reduced the balance outstanding from $4.6 million
to $3.5 million.  Repayment of principal and interest on these mortgage
loans is non-recourse to ElderTrust.

     The third loan with a loan balance of $14.2 million at June 30, 2003
and which is secured by the Harston Hall and Pennsburg properties, until
August 10, 2003 to provide time for the lender and the Company to
negotiate a resolution of this loan.  During the three months ended June
30, 2003, the Company derived $0.5 million of revenue and a net loss of
$1.8 million from the properties including a $2.0 million impairment
loss.  This loan was satisfied on August 13, 2003 for $11.5 million.
See Managements Discussion and Analysis of Financial Condition and Results
of Operations - Liquidity and Capital Resources for further explanation
of the transaction that resulted in the satisfaction of this loan.


                                    4

                                ELDERTRUST
                        NOTES TO UNAUDITED CONDENSED
                CONSOLIDATED FINANCIAL STATEMENTS (continued)


     The Company has a working capital deficit of $12.1 million at June
30, 2003, resulting primarily from the mortgage loan secured by the Harston
Hall and Pennsburg properties being  due within one year.

2.   Discontinued Operations

     Under Statement of Financial Accounting Standards No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets, the
Company is required to reclassify from continuing operations to
discontinued operations the results of operations from any property that
is disposed of or is classified as held for sale and where the Company
will not have significant continuing involvement.

     The Salisbury Medical Office Building (SMOB), located in Salisbury,
Maryland, was classified as held for sale in June 2002.  On March 7, 2003,
the Company sold the SMOB for approximately $1.0 million.  These proceeds
were used to payoff the $1.0 million of debt secured by the property.

     The following represents a summary of results of operations of the
SMOB, which was classified in discontinued operations as of and for the
six month period ended June 30, 2003 and 2002:

                                               For the six months ended
                                                       June 30,
                                               -------------------------
                                                    2003       2002
                                               -------------------------
                                               (unaudited, in thousands)

 Rental revenue                                  $   17       $   91
 Other income (expense)                              (5)          32
                                               -------------------------
   Total revenue                                     12          123

 Interest expense                                    16           46
 Depreciation and amortization                        -           19
 Property operating expense                          24           30
 General and administrative                           9           17
 Loss on impairment of asset                         37          250
                                               -------------------------
   Total expenses                                    86          362

Loss before minority interest                       (74)        (239)

Minority interest                                     3           10
                                               -------------------------
Loss from discontinued operations                  ($71)       ($229)
                                               =========================

                                    5


                                ELDERTRUST
                        NOTES TO UNAUDITED CONDENSED
                CONSOLIDATED FINANCIAL STATEMENTS (continued)

3.   Restructuring Agreement

     The Company announced on July 14, 2003, that it had entered into a
non-binding letter of intent (the Agreement) with Genesis Health
Ventures, Inc. (Genesis) to restructure their current business
relationship.  As was previously announced, Genesis intends to spin-off
its ElderCare division (the Spin-Off) which will be known as Genesis
HealthCare Corporation (HealthCare).  Operations of ElderTrust assets
that are leased to Genesis would be spun off to HealthCare as part of
the transaction and, as a result, ElderTrust has certain approval rights
with respect to the Spin-Off.  The Agreement sets forth the proposed
terms of the restructuring of the Companys current transactions with
Genesis and approval of the Spin-Off.  The Agreement also addresses
assets currently leased by the Company to Crozer/Genesis ElderCare
Limited Partnership (Crozer) and Genesis Eldercare Partnership of New
England, L.P. (NDNE).

Under the terms of the Agreement, and exclusive of the NDNE transaction:


   * Six properties, including the Harston property currently leased to
     Crozer, would be sold to HealthCare;

   * HealthCare would replace the Company as primary lessee on seven
     properties currently subleased to Genesis and accounted for by the
     Company as capital leases;

   * The three remaining properties currently leased to Crozer would be
     leased to, and these leases would be guaranteed by, HealthCare;

   * Rents on three properties would be reduced in exchange for a cash
     payment; and,

   * The Company would agree to a change of the guarantor from Genesis
     to HealthCare and to make other modifications to the leases
     affecting this change.

     Total consideration for the above transactions, exclusive of the
NDNE transaction, would be approximately $132.1 million, of which
approximately $49.2 million would be paid in cash and $82.9 million
through the assumption of existing debt and capitalized lease
obligations.  Of these amounts, $5.0 million would be allocable to the
guarantor change.  Subsequent to the transactions, and on an estimated
pro forma basis, the Company would have total assets of approximately
$208.0 million of which approximately $42.6 million would consist of
unrestricted cash.

     The parties have agreed to complete the proposed transactions as
soon as possible but in any event no later than December 31, 2003.

     Under the NDNE transaction Genesis or the tenant (of which Genesis
is a 90% limited partner, the New England Partnership) would pay
ElderTrust $5.0 million related to certain lease modifications (all
security deposits placed by the New England Partnership with respect to
four New England Properties would be a credit toward the lease
modifications, unless and to the extent ElderTrust is entitled to retain
them pursuant to the applicable leases).  Additional information is not
provided for the NDNE transaction because the terms of this transaction
are currently being negotiated with the third party involved in that
transaction.

                                    6

                             ELDERTRUST
                        NOTES TO UNAUDITED CONDENSED
                CONSOLIDATED FINANCIAL STATEMENTS (continued)


     For a more detailed description of the proposed transactions with
Genesis, see Item 5 of the Current Report on Form 8-K filed by the
Company with the SEC on July 14, 2003.

     Because the transactions are subject to conditions precedent,
including negotiation and execution of definitive documentation for
the transactions and final board and lender approvals and receipt of
fairness opinions for each party to the transactions, there can be no
assurance that the transactions contemplated by the Agreement will be
completed as proposed.

4.  Share Option Plans

     The Company applies the intrinsic value-based method of accounting
prescribed by the Accounting Principles Board Opinion No. 25 (APB No. 25),
Accounting for Stock Issued to Employees, and related interpretations, in
accounting for its fixed plan share options.  As such, compensation expense
would be recorded only if the current market price of the underlying shares
on the date of grant exceeded the exercise price.

     Additionally, during the second quarter of 2003, the Company had issued
performance based stock options accounted for as variable plans under APB
No. 25.  The Company recognized a minimal amount of compensation expense
related to the performance based stock options during the period ended
June 30, 2003.

     The following table shows compensation expense that would have been
recorded during the periods presented, for the Plans based upon the fair
value of the option awards, under SFAS No. 123, Stock Based Compensation.

     Pro forma net income and net income per share would have been as
follows:


                                For the three months   For the six months
                                   ended June 30,        ended June 30,
                                -----------------------------------------
                                    2003      2002       2003     2002
                                -----------------------------------------
Net income, as reported           ($1,164)  $   341    $   356   $  951
Add: stock based compensation
  under stock option plans              7         -          7        -
Deduct: total stock based
  employee compensation expense
  determined under fair value
  based method for all awards,
  net of related tax effects         (165)      (50)      (176)     (60)
                                -----------------------------------------
Pro forma net income (loss)        (1,322)      291        187      891
                                -----------------------------------------
Net income (loss) per share, as
 reported basic and diluted       ($ 0.15)   $ 0.05     $ 0.05   $ 0.13
Pro forma net income (loss) per
 share basic and diluted          ($ 0.18)   $ 0.04     $ 0.03   $ 0.13

                                    7

                             ELDERTRUST
                        NOTES TO UNAUDITED CONDENSED
                CONSOLIDATED FINANCIAL STATEMENTS (continued)

5.   Distributions

     On May 16, 2003, the Company paid a quarterly distribution of $0.16
per common share to shareholders of record on April 28, 2003.

     On July 14, 2003, the Companys Board of Trustees authorized the
payment of a quarterly distribution of $0.16 per common share to
shareholders of record on August 1, 2003.  The distribution will be
paid on August 15, 2003.

6.   Income Per Share

     The following table sets forth the computation of basic and diluted
net income per share for the periods indicated (in thousands, except per
share data):

                                For the three months   For the six months
                                   ended June 30,        ended June 30,
                                -----------------------------------------
                                    2003      2002       2003     2002
                                -----------------------------------------
Basic net income(loss) per share:
--------------------------------
Weighted average common shares
  outstanding                        7,712     7,361    7,655    7,349
                                =========================================

Net income (loss) from
 continuing operations             ($1,164)     $575     $427   $1,180
Basic net income (loss) from
 continuing operations per share    ($0.15)    $0.08    $0.06    $0.16

Loss from discontinued operations        -     ($234)    ($71)   ($229)
Basic loss from discontinued
 operations per share                    -    ($0.03)  ($0.01)  ($0.03)

Net income (loss)                  ($1,164)     $341     $356     $951
Basic net income (loss) per share   ($0.15)    $0.05    $0.05    $0.13


Diluted net income(loss) per share:
-----------------------------------
Weighted average common shares
 outstanding                         7,712     7,361    7,655   7,349

Common stock equivalents - stock
 options and warrants                    -       344       61     343
                                -----------------------------------------
Total weighted average number of
 diluted shares                      7,712     7,705    7,716   7,692
                                =========================================

                                     8

                             ELDERTRUST
                        NOTES TO UNAUDITED CONDENSED
                CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                For the three months   For the six months
                                   ended June 30,        ended June 30,
                                -----------------------------------------
                                    2003      2002       2003     2002
                                -----------------------------------------

Net income (loss) from
 continuing operations            ($1,164)     $575      $427    $1,180
Diluted net income (loss) from
 continuing operations per share   ($0.15)    $0.07     $0.06     $0.15

Loss from discontinued operations       -     ($234)     ($71)    ($229)
Diluted loss from discontinued
 operations per share                   -    ($0.03)   ($0.01)   ($0.03)

Net income (loss)                 ($1,164)     $341      $356      $951
Diluted net income (loss) per
 share                             ($0.15)    $0.04     $0.05     $0.12


     Units of ElderTrust Operating Limited Partnership are not included
in the determination of weighted average common shares outstanding for
purposes of computing diluted income per share as they are anti-dilutive.

                                    9


ITEM 2.  Managements Discussion and Analysis of Financial Condition
         and Results of Operations

Forward-Looking Statements

     Managements Discussion and Analysis of Financial Condition and
Results of Operations contains certain forward-looking statements with
respect to results of operations and financial condition of ElderTrust
and its consolidated subsidiaries (collectively, ElderTrust or the
Company).  In general, these statements are identified by the use of
forward-looking words or phrases, including but not limited to intended,
will, should, could, may, continues, continued, estimate, estimated,
expects, expected, believes, anticipates and anticipated or the negative
or variations thereof or similar terminology.  These statements are not
guarantees of the Companys future performance, and are subject to risks
and uncertainties and other important factors that could cause the
Companys actual performance or achievements to be materially different
from those expressed or implied by these forward-looking statements.
These risks, uncertainties and factors include, but are not limited to:

   *  the extent to which the Company can consummate the proposed
      restructuring transactions, described herein with Genesis Health
      Ventures, Inc. (Genesis), the Companys principal tenant;
   *  the ability of Genesis (and after the proposed spin-off of its
      healthcare assets, HealthCare) to continue making lease payments
      to the Company;
   *  fluctuation of interest rates;
   *  availability, terms and use of capital;
   *  general economic, business and regulatory conditions;
   *  federal and state government regulation;
   *  changes in Medicare and Medicaid reimbursement programs; and
   *  competition.

     Refer to the Companys Annual Report on Form 10-K for the year ended
December 31, 2002 for a discussion of these and other factors which
management believes may impact the Company.  The forward-looking statements
included herein represent the Companys judgment as of the date of this
Form 10-Q and should be read in conjunction with the unaudited condensed
consolidated financial statements and notes thereto appearing elsewhere
in this report.  Although the Company believes that the expectations
reflected in these forward-looking statements are reasonable, there can
be no assurance that such expectations will prove to be correct.  All
subsequent written and oral forward-looking statements attributable to
the Company are expressly qualified in their entirety by the cautionary
statements.  The Company disclaims, however, any intent or obligation to
update its forward-looking statements.

                                   10

General

     The Company is a self-managed and self-administered real estate
investment trust (REIT) that invests principally in senior housing and
other healthcare facilities, primarily skilled nursing facilities,
assisted and independent living facilities and medical office and other
buildings.  The Company is the general partner of, and conducts all of
its operations through, ElderTrust Operating Limited Partnership (the
Operating Partnership).  At June 30, 2003, the Company owned a 96.3%
interest in the Operating Partnership.

     The Companys consolidated assets consist primarily of the assets of
the Operating Partnership and its consolidated subsidiaries.  At June 30,
2003, the Companys consolidated assets primarily consisted of a
diversified portfolio of 31 healthcare properties with an aggregate
carrying value of $275.1 million.  The portfolio consists of eleven
assisted living facilities, fifteen skilled nursing facilities, including
seven properties that are leased by the Company under capital leases,
two independent living facilities and three medical office and other
buildings.  Skilled nursing facilities and assisted and independent
living facilities comprised approximately 96% of the Companys consolidated
assets at June 30, 2003.

     Approximately 93% of the Companys consolidated assets at June 30,
2003 consisted of properties leased to or managed by subsidiaries of
Genesis or entities in which it has an equity interest (Genesis Equity
Investees).  Revenues recorded by the Company in connection with these
leases aggregated $7.1 million during the second quarter of 2003 and $3.8
million during the second quarter of 2002.  Revenues for the six months
ended June 30, 2003 and 2002 were $14.2 million and $7.5 million,
respectively.  As a result of these relationships with Genesis, the
Companys revenues and ability to meet its obligations depend, in
significant part, upon the ability of Genesis and Genesis Equity Investees
to meet their lease obligations.  Any failure of these entities to
continue their operations and/or to continue to make lease payments to the
Company could have a significant adverse impact on the Companys operations
and cash flows due to the significant portion of our properties leased to
such entities.

Critical Accounting Policies

     The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.  Actual
results could vary from those estimates.

     The Companys critical accounting policies are as follows:

Impairment of Long-Lived Assets

     The Company reviews its long-lived assets for impairment whenever
events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable or when managements intended use of an

                                   11

asset has changed.  Once circumstances require a review the asset is
tested to determine if it is impaired.  An asset is impaired if the
carrying amount of an asset is greater than the future net cash flows,
measured on an absolute basis, expected to be generated by the asset.
If the asset is impaired, the Company records an impairment charge equal
to the assets carrying amount over its estimated fair value.

     Real Estate Properties

     Real estate properties are recorded at cost less accumulated
depreciation, amortization and impairment charges.  Acquisition costs
and transaction fees, including legal fees, title insurance, transfer
taxes, external due diligence costs and market interest rate adjustments
on assumed debt directly related to each property are capitalized as a
cost of the respective property.  The cost of real estate properties
acquired is allocated between land, buildings, improvements and leases,
if applicable, based upon estimated market values at the time of
acquisition.  Depreciation is provided for on a straight-line basis over
an estimated composite useful life of twenty-eight and one-half years for
buildings and improvements.

     We classify the properties we are actively marketing as held for sale
once all of the following conditions are met:

   * our board has approved the sale, and
   * we have a fully executed agreement with a qualified buyer which
     provides for no significant outstanding or continuing obligations
     with the property after sale and does not contain any significant
     contingencies related to the completion of the transaction.

     We carry properties held for sale at the lower of their carrying
values or estimated fair values less costs to sell.  We cease depreciation
at the time the asset is classified as held for sale.  We segregate the
held for sale properties on our consolidated balance sheet.

     Revenue Recognition

     The Companys real estate assets are leased to operators primarily
through long-term triple-net leases.  These leases generally take the
form of percentage, minimum or fixed rents.   Lease payments are
recognized as revenue when earned, based on the provisions of the
underlying leases.  The Company reports base rental revenue on these
leases using the straight-line method over the terms of the respective
leases.  The Company records an unbilled rent receivable or payable
representing the amount that the straight-line rental revenue exceeds or
reduces the rent currently collectible under the lease agreements.

Proposed Restructuring Agreement with Genesis

     The Company announced on July 14, 2003 that it had entered into a
non-binding letter of intent (the Agreement) with Genesis Health Ventures,
Inc. (Genesis)

     For additional information regarding the Agreement, see Note 3
Restructuring Agreement.

                                   12

     Pro forma condensed financial and FFO information giving effect to
the proposed transactions contemplated by the Agreement is set forth
below:

	Pro forma condensed selected balance sheet data as of June 30,
2003:

                                                       (in thousands)
                                                    Actual
                                                 (unaudited)  Pro forma
                                                 ----------------------
Net real estate properties                        $275,128    $153,423
Cash and cash equivalents                            6,348      42,604
Total assets                                       294,590     207,952
Mortgages, notes and bonds payable and
  capital lease obligations                        201,612     104,864
Total liabilities                                  209,116     113,383
Total shareholders equity                           82,036      90,796

     Pro forma condensed selected statement of operations data for the
six months ended June 30, 2003 and for the twelve months ended December
31, 2002:

                                          (dollars in thousands,
                                         except per share amounts)
                                     Six months ended Twelve months ended
                                        June 30, 2003  December 31, 2002
                                     ------------------------------------
                                      Actual Pro forma  Actual Pro forma
                                     ------------------------------------
Rental revenues                       $16,089  $9,061   $21,906  $15,519
Total revenues                         16,223   9,192    25,329   18,934
Interest expense                        7,223   3,917    10,167    7,433
Loss on impairment of long lived
 assets                                 2,021       -     2,119        -
Total expenses                         15,785   8,096    23,144   16,182
Net income from continuing operations    $427  $1,061      $768   $2,656
Basic weighted average number of
  common share outstanding              7,655   7,655     7,401    7,401
Basic income per share                  $0.06   $0.14     $0.10    $0.36
Diluted weighted average number of
  common share outstanding              7,716   7,716     7,708    7,708
Diluted income per share                $0.06   $0.14     $0.10    $0.34

                                    13

     Pro forma condensed selected Funds From Operations data (see Funds
From Operations below for additional information) for the six months
ended June 30, 2003 and for the twelve months ended December 31, 2002:

                                         (dollars in thousands,
                                         except per share amounts)
                                     Six months ended Twelve months ended
                                        June 30, 2003  December 31, 2002
                                     ------------------------------------
                                      Actual Pro forma  Actual Pro forma
                                     ------------------------------------
Funds From Operations:
  Net income                             $356   $1,061      $506   $2,656
  Minority interest                         8       35        41       63
                                     ------------------------------------
  Net income before minority interest     364    1,096       547    2,719

Adjustments to derive funds from
   operations:
Add: Real estate depreciation and
     amortization
        Consolidated entities           5,215   2,916      7,119    5,047
        Unconsolidated entities             -       -      3,367    3,367
     Impairment charge on real estate   2,021       -      2,434      315
     Loss on sale of real estate
       property                            38       -          -        -
                                     ------------------------------------
Funds from operations before
 allocation to minority interest        7,638   4,012     13,467   11,448
Funds from operations allocable to
 minority interest                       (278)   (146)      (602)    (512)
                                     ------------------------------------
Funds from operations attributable
 to the common shareholders            $7,360  $3,866    $12,865  $10,936
                                     ------------------------------------

Basic weighted average number of
 common shares outstanding              7,655   7,655      7,401    7,401
Basic funds from operations per share   $0.96   $0.51      $1.74    $1.48
Diluted weighted average number of
 common shares outstanding              7,716   7,716      7,708    7,708
Diluted funds from operations per
 share                                  $0.95   $0.50      $1.67    $1.42

Results of Operations

     Three months ended June 30, 2003 compared with the three months
ended June 30, 2002

     Revenues

     Rental revenues were $8.1 million and $4.6 million for the three
months ended June 30, 2003 and 2002, respectively.  Rental revenues
attributable to Genesis and Genesis Equity Investees totaled $7.1 million
and $3.8 million, or 88 % and 83% of total rental revenues for the three


                                   14

months ended June 30, 2003 and 2002, respectively.  The amounts and
percentages for the three months ended June 30, 2003 are higher than the
corresponding period in 2002 primarily due to the consolidation during the
third quarter of 2002 of three entities where the Company obtained a
controlling interest in which previously the Company held a 99% non-
controlling interest.  These entities generated $3.4 million of rental
revenue during the second quarter of 2003.

     Interest income from unconsolidated equity investees was $0.9 million
for the quarter ended June 30, 2002.  These amounts are no longer applicable
following the consolidation of Meridian, Cabot and Cleveland during the
third quarter of 2002, as the loans are eliminated during the consolidation
process.

     Expenses

     Interest expense, which includes amortization of deferred financing
costs of $104,000 and $77,000, was $3.6 million and $2.1 million for the
three months ended June 30, 2003 and 2002, respectively.  The increase of
$1.5 million is primarily due to the consolidation of previously
unconsolidated entities.  Of the increase, approximately $1.7 million
represents interest expense incurred by those entities.  This increase
in interest expense was partially offset by lower LIBOR rates and lower
balances on other debt during 2003 as compared to the comparable period
in 2002.

     Depreciation expense was $2.6 million and $1.5 million for the three
months ended June 30, 2003 and 2002, respectively.  This increase is due
to the consolidation of previously unconsolidated entities during the
third quarter of 2002.

     General and administrative expenses were $0.8 million and $0.6
million for the three months ended June 30, 2003 and 2002, respectively.
Of this $0.2 million increase, approximately $95,000 is due to higher
accounting, legal and other expense accruals associated with the
implementation of the Sarbanes-Oxley Act of 2002.  Approximately $34,000
is due to the Company having moved into new corporate office space during
the fourth quarter of 2002 and approximately $35,000 is due to increased
insurance premiums.

     Loss on impairment of assets for the quarter ended June 30, 2003 was
$2.0 million.  This impairment related to the Harston Hall property, which
was adjusted to market value in connection with the loan extension
negotiations.

     Net loss from discontinued operations of $234,000 was recorded for
the quarter ended June 30, 2002.  The Salisbury Medical Office Building
(SMOB), located in Salisbury, Maryland, was classified as held for sale
in June 2002.  On March 7, 2003, the Company sold the SMOB for
approximately $1.0 million.  The sales proceeds were used to payoff the
$1.0 million of debt secured by the property.

                                   15

     Six months ended June 30, 2003 compared with the six months ended
June 30, 2002

     Revenues

     Rental revenues were $16.1 million and $9.3 million for the six
months ended June 30, 2003 and 2002, respectively.  Rental revenues
attributable to Genesis and Genesis Equity Investees totaled $14.2
million and $7.5 million, or 89% and 81% of total revenues for the six
months ended June 30, 2003 and 2002, respectively.  The amounts and
percentages for the six months ended June 30, 2003 are higher than the
corresponding period in 2002 primarily due to the consolidation during
the third quarter of 2002 of three entities in which the Company held a
99% non-controlling interest.  These entities generated $6.7 million of
rental revenue during the six months ended June 30, 2003.

     Interest income from unconsolidated entities was $1.8 million for
the six months ended June 30, 2002.  These amounts are no longer
applicable following the consolidation of Meridian, Cabot and Cleveland
during the third quarter of 2002, as the loans are eliminated during the
consolidation process.

     Other income of $234,000 was recorded for the six months ended June
30, 2002.  For the six months ended June 30, 2002, the company recognized
a gain of  $180,000 on the sale of shares acquired as satisfaction of a
former tenants security deposit obligation under its lease of the
Woodbridge facility to a privately held company, of which Mr. Walker
is a principal stockholder.  In February 2002, the Company entered into
a new lease and purchase option agreement for the Woodbridge facility with
a new tenant for an initial lease term of 10 years commencing on February
1, 2002.

     Expenses

     Property operating expenses were $0.6 million and $0.7 million for
the six months ended June 30, 2003 and 2002, respectively.  This decrease
is due to approximately $135,000 in expenses related to the Woodbridge
lease termination, being recorded during the six months ended June 30,
2002.

     Interest expense, which includes amortization of deferred financing
costs of $207,000 and $147,000, was $7.2 million and $4.2 million for the
six months ended June 30, 2003 and 2002, respectively.  The increase of
$3.0 million is due to higher third party debt balances outstanding at
June 30, 2003 as compared to June 30, 2002, as a result of the
consolidation of Meridian, Cabot and Cleveland.  The Bank Credit Facility
and mortgages and notes payable to third parties increased from $110.3
million at June 30, 2002 to $136.1 million at June 30, 2003, including an
increase of approximately $34.1 million as a result of the consolidation
of Meridian, Cabot and Cleveland.  The weighted average interest rate on
outstanding third party debt remained the same at 6.9% for the quarters
ended June 30, 2003 and 2002, although the debt balances for the second
quarter of 2003 were higher than the corresponding period in 2002, due to
the consolidation of Meridian, Cabot and Cleveland.  The Companys interest
rate on the Bank Credit Facility was 5.13% at June 30, 2002.  The Company
paid off the Bank Credit Facility\Guidance Line on January 27, 2003.  The
Companys interest rate on its variable rate mortgages was 4.4% (3.00% over
the one-month LIBOR) at June 30, 2003 compared to 4.9% at June 30, 2002.

                                   16

     Depreciation expense was $5.2 million and $3.0 million for the six
months ended June 30, 2003 and 2002, respectively.  This increase is due
to the consolidation of previously unconsolidated entities during the
third quarter of 2002.

     General and administrative expenses were $1.6 million and $1.2
million for the six months ended June 30, 2003 and 2002, respectively.
This increase of $0.4 million results primarily from approximately
$183,000 of higher accounting, legal and other expense accruals
associated with the implementation of certain governance and financial
disclosures of the Sarbanes-Oxley Act of 2002.  Additionally,
approximately $67,000 is due to the Company having moved into new
corporate office space during the fourth quarter of 2002, approximately
$60,000 is due to increased insurance premiums and approximately $63,000
is due to engineering studies done on our properties in 2003.

     Bad debt expense for the six months ended June 30, 2003 includes a
recovery of amounts previously deemed uncollectible.

     Loss on impairment of assets for the six months ended June 30, 2003
was $2.0 million.  This impairment related to the Harston Hall property,
which was adjusted to market value in connection with the loan extension
negotiations and a change in the expected holding period of the property.

     Loss from discontinued operations for the six months ended June 30,
2003 was $0.1 million as compared to the loss for the corresponding period
in 2002 of $0.2 million.  The $0.2 million loss during the second quarter
of 2002, is a result of classifying the Salisbury Medical Office Building,
located in Salisbury, Maryland as held for sale.  An impairment charge of
$250,000 was recorded during the second quarter of 2002.  On March 7, 2003,
the Company sold the Salisbury Medical Office Building for approximately
$1.0 million and realized a nominal gain/loss.  These proceeds were used to
payoff the $1.0 million of debt secured by the property.

Liquidity and Capital Resources

     Net cash provided by operating activities was $6.8 million and $4.7
million for the six months ended June 30, 2003 and 2002, respectively.
This increase of $2.1 million is primarily due to a $2.1 million increase
in depreciation as a result of the consolidation of the previously
unconsolidated entities, offset in part, by a $0.6 million decrease in net
income, $0.2 million decrease in losses related to property, plant and
equipment and $1.1 million decrease in minority interest and equity in
losses of unconsolidated subsidiaries resulting from the consolidation of
the previously unconsolidated entities.

     Net cash used in investing activities was $0.4 million for the three
months ended June 30, 2003 compared to net cash provided by investing
activities of $0.4 million for the corresponding period in 2002.  The
decrease in net cash provided by investing activities was primarily due
to an increase of $0.1 million in capital expenditures, a decrease of

                                   17

$0.1 million in proceeds from affiliates and $0.5 million decrease in the
required level of restricted cash in 2003 compared to 2002, including
security deposits that were released from escrow accounts in connection
with a change in the tenant at the Companys Woodbridge facility in 2002.

     Net cash used in financing activities was $7.5 million for the three
months ended June 30, 2003 compared to $4.7 million for the corresponding
period in 2002.  This increase in cash used by financing activities is a
result of $1.2 million in distributions paid to our shareholders in 2003,
there were no distributions paid in 2002, and an increase in principal
payments on mortgage and bonds payable of approximately $2.6 million as
compared to 2002 relating to the consolidation of Meridian, Cabot and
Cleveland, offset in part, by a decrease in payments on the Guidance
Line\Bank Credit facility of $1.0 million.

     On August 30, 2002, the Operating Partnership entered into the
Guidance Line.  ElderTrust guaranteed the Guidance Line.  Initial
borrowings under the Guidance Line of approximately $3.1 million were
used to pay off the Companys prior credit facility and to pay certain
transaction and other costs.  On January 27, 2003, the Company paid $3.1
million to Wachovia Bank to pay off the balance due under the Guidance
Line.  As of June 30, 2003, there were no amounts outstanding under the
Guidance Line and the Company has $7.5 million available to borrow,
subject to lender approval and borrowing base limitations.

     On July 17, 2003, the Company borrowed $5.5 million on the Guidance
Line in anticipation of selling the Harston Hall property and the
subsequent pay-off of the mortgage loan on the Harston Hall and Pennsburg
properties.

     At December 31, 2002 the Company had three non-recourse mortgage
loans with an aggregate principal balance of $30 million secured by four
properties.  The loans matured in December 2002.  The Company announced
in November 2002 that the maturity date of one loan, secured by the
Lopatcong property, had been extended until December 1, 2004.  In
February 2003, the lender also extended a $4.6 million mortgage loan
secured by the Wayne property to December 1, 2004.  In connection with
the extension, the Company made a $1.1 million payment and reduced the
balance outstanding from $4.6 million to $3.5 million.

     The lender extended the maturity date of the remaining mortgage loan
with a loan balance of $14.2 million at June 30, 2003, which is secured by
the Harston Hall and Pennsburg properties, until August 10, 2003 to provide
time for the lender and the Company to negotiate a resolution of this loan.

     In May the Company's Board of Trustees authorized the sale
of the Harston Hall property and reconfirmed the approval in July of 2003.
On July 17, 2003 the Company borrowed $5.5 million on the Guidance Line in
anticipation of selling the Harston Hall property and the subsequent
pay-off of the mortgage loan on the Harston Hall and Pennsburg properties.
On August 13, 2003 the Company restructured its lease transactions with
Crozer/Genesis ElderCare Limited Partnership (Crozer) and satisfied its
$14.0 million loan obligation secured by the Harston Hall and Pennsburg
properties.  Under the terms of the agreement:

          *   The Harston Hall property was sold to Genesis Health
              Ventures, Inc. for $2.6 million;
          *   The annual rent on the Pennsburg Manor property was reduced
              to $656,000 per year in exchange for a one-time payment by
              Genesis of $2.5 million; and
          *   The lease for the Pennsburg, Chapel Manor and Belvedere
              properties were extended for approximately twelve years,
              and certain other changes were made to the leases, including
              but not limited to elimination and return of the security
              deposits, the addition of a lease coverage ratio test of at
              least 1.25:1 and the addition of lease guarantees by Genesis.
              Following Genesis proposed spin-off to its shareholders of
              its Eldercare business (HealthCare), the leases will be
              guaranteed by HealthCare.

     The $14.0 million non-recourse loan securing the Harston Hall and
Pennsburg properties was also settled as a result of the above transaction.
This loan was satisfied in full for a cash payment of $11.5 million,
consisting of the $5.1 million received by the Company from Genesis, $5.5
million obtained by the Company under its credit facility with Wachovia
Bank and $0.9 million from cash held on its balance sheet.


                                   18

     At June 30, 2003, the Harston Hall and Pennsburg properties had a
net book value of $11.5 million.  During the three months ended June 30,
2003, the Company derived $0.5 million of revenue and net income, before
the loss on impairment of the real estate of $0.2 million, of $0.3 million
from the properties.  The repayment of principal and interest on these
mortgage loans is non-recourse to ElderTrust.  During the quarter ending
September 30, 2003, the Company will record a gain of approximately $2.5
million corresponding to the amount of debt forgiven by the lender in the
above transaction.

     The Company had a working capital deficit of $12.1 million at June
30, 2003 resulting primarily from the mortgage loan secured by the Harston
Hall and Pennsburg properties being currently due.

     As of June 30, 2003, the Company had shareholders equity of $82.0
million and debt aggregating $201.6 million, which represents a debt to
equity ratio of 2.46 to 1.  The debt to equity ratio was 2.57 to 1 at
December 31, 2002.  The decrease in the debt to equity ratio was primarily
due to a $11.2 million reduction in debt from December 31, 2002 to June 30,
2003, which included the repayment of the Guidance Lines outstanding
balance at December 31, 2003 of $3.1 million, the payment of $3.3 million
on mortgages and bonds payable, the repayment of the Salisbury Medical
Office Building mortgage loan of approximately $1.0 million and $3.8
million of notes payable to ET Capital, which were eliminated in the
consolidation of that entity during the quarter.

     At June 30, 2003, the Companys third party indebtedness of $201.6
million consisted of $28.2 million in variable rate debt, $108 million in
fixed rate debt and a capital lease obligation of $65.4 million.  The
weighted average annual interest rate was 6.9% at June 30, 2003.  Based on
interest rates at June 30, 2003, quarterly debt service requirements
approximate $4.7 million.

     Future increases in interest rates, as well as any defaults by
tenants on their leases, could adversely effect the Companys cash flow
and its ability to pay its obligations.

     Facilities owned by the Company and leased to tenants under
percentage and minimum rent triple net leases require the lessee to pay
substantially all expenses associated with the operation of such
facilities.  Facilities owned by the Company and subject to percentage
and minimum rent leases represent approximately 96% of the Companys
rental revenues at June 30, 2003.  As a result of these arrangements,
the Company does not believe it will be responsible for significant
expenses in connection with the facilities during the terms of the
leases.  However, there can be no assurance the Company will not be
responsible for significant expenses of its leased properties in the
event one or more of its lessees default on their leases with the
Company.

Contractual Obligations and Commercial Commitments

     The following table represents the Companys contractual obligations
as of June 30, 2003 (amounts in thousands):

                                   Payments due by period:
                                   Less than  1 to 2  3 to 4  5 years
                           Total    1 year     years   years  and after
                          ---------------------------------------------
Long-term debt            $201,612  $17,612   $21,891  $7,368  $154,741
Operating lease                693      165       170     176       182
                          ---------------------------------------------
Total contractual
 obligations              $202,305  $17,777   $22,061  $7,544  $154,923
                          =============================================

     As of June 30, 2003, the Companys commercial commitments consisted
of the following:

     The Company provided two letters of credit aggregating $1.0 million
in connection with the Woodbridge and Highgate debt documents.

                                   19

     The Company entered into an agreement in 1998 with respect to the
NDNE properties (collectively, ET Sub-Vernon, Cabot and Cleveland) that
allows all deductions for depreciation and low income housing tax credits
(LIHTC) on the NDNE properties to be allocated to the holders of the Class
C (LIHTC) Units of limited partnership interest of the Operating
Partnership through 2012.  The agreement further states that, in the
event that prior to December 31, 2012, the Operating Partnership either
disposes of all or any portion of their interests in the NDNE properties
or takes any other action with respect to the NDNE properties that causes
the qualified basis to be less than the amount thereof on the date of
purchase and solely by reason of such disposition or other action all
or any part of the LIHTCs actually allowed to the holders of the Class C
(LIHTC) Units are subject to recapture pursuant to Section 42(j) of the
Internal Revenue Code, the Company shall pay to such holders of the Class
C (LIHTC) Units cash in an amount equal to the credit recapture amount,
if any, payable by the holders of the Class C (LIHTC) Units solely as the
result of such disposition or other action.  The Company also covenanted
that, in the event that prior to December 31, 2013, the Operating
Partnership either disposes of all or any portion of the Companys interest
in the NDNE properties or takes any other action with respect to the NDNE
properties that causes the holders of the Class C (LIHTC) Units to have to
recognize a recapture of all or any portion of the depreciation deductions
that have been specially allocated to them, the Company shall pay to the
holders of the Class C (LIHTC) Units cash in an amount equal to the excess
of (a) 38% of such depreciation deductions that are required to be
recaptured solely as the result of such disposition or other action
over (b) the discounted present value of such amount, discounted from
December 31, 2013 to the last day of the calendar year in which
depreciation deductions are recaptured.

Financial Covenants

     This section presents the material financial covenants to which the
Company is subject to under our debt agreements and the degree to which
the Company is in compliance with these covenants as of June 30, 2003.
Management is not presenting these covenants and the related calculations
for any other purpose or for any other period, and is not intending for
these measures to otherwise provide information about the Companys
financial condition or results of operations.  If we fail to comply with
any of these requirements, then the related debt could become due and
payable before its stated due date.  These measures should only be used
for the purposes of testing our compliance with our indebtedness
requirements.

                                                        (in thousands)
                                                        June 30, 2003

Total assets (per consolidated balance sheet)             $ 294,590
                                                         -----------

Total liabilities (per consolidated balance sheet)        $ 209,116
                                                         -----------

EBITDA, as defined in applicable debt agreements:
  Net income (loss) for the 12 months ended June 30, 2003     ($ 90)
  Add:  Nonrecurring items
   Loss on impairment of long-lived assets for the 12
     months ended June 30, 2003                               4,243
   Bad debt expense (recovery) for the 12 months ended
     June 30, 2003                                             (894)

                                   20

  Add:  Income taxes for the 12 months ended June 30, 2003        4
  Add:  Interest expense for the 12 months ended
        June 30, 200                                         13,233
  Add:  Depreciation and amortization for the 12 months
        ended June 30, 2003                                   9,376
                                                         -----------
EBITDA, as defined in applicable debt agreements            $25,872
                                                         -----------

Consolidated indebtedness (per consolidated balance
  sheet)                                                   $201,612
                                                         -----------

Book value, as defined in applicable debt agreements:
  Total assets (per consolidated balance sheet)            $294,590
  Add:  Accumulated depreciation and amortization
        (per consolidated balance sheet)                     48,832
                                                         -----------
Book value, as defined in applicable debt agreements       $343,422
                                                         -----------

Interest expense excluding amortization of deferred
  financing costs for the 12 months ended June 30, 2003     $12,786
                                                         -----------

Fixed Charges, as defined in applicable debt agreements:
  Interest expense excluding amortization of deferred
    financing costs for the 12 months ended June 30, 2003   $12,786
  Lease expense for the 12 months ended June 30, 2003           138
  Current maturities of funded debt                           3,005
                                                         -----------
Fixed charges, as defined in applicable debt agreements     $15,929
                                                         -----------

     The following table sets forth the material financial covenants to
which we are subject under our indebtedness, and the degree to which we
complied with those covenants as of June 30, 2003:

                                                       Actual Ratio/Test
    Financial Covenant         Required Ratio/Test    as of June 30, 2003
-------------------------------------------------------------------------
Minimum tangible net worth
 (total assets  total
 liabilities)                      $75.0 million         $85.5 million
Total leverage ratio
 (consolidated indebtedness/book
 value)                             Less than 65%          58.7%
Minimum interest coverage ratio
 (EBITDA/interest expense
 excluding amortization of
 deferred financing costs)          Greater than 1.75       2.02
Minimum fixed charge ratio
 (EBITDA/fixed charges)             Greater than 1.50       1.62
EBITDA to interest expense
 (EBITDA/interest expense)(1)       Greater than 1.80       1.96

(1)  This interest coverage ratio requirement increases to 1.90:1
     after June 30, 2004.

Funds from Operations

     The White Paper on Funds from Operations approved by the Board of
Governors of NAREIT defines Funds from Operations (FFO) as net income
(loss), computed in accordance with accounting principles generally
accepted in the United States of America, excluding gains (losses) from
sales of property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures.
Adjustments for unconsolidated partnerships and joint ventures are

                                   21

calculated to reflect FFO on the same basis.  The Company believes that
FFO is helpful to investors as a measure of the performance of an equity
REIT.  The Company computes FFO using standards established by NAREIT
which may not be comparable to FFO reported by other REITs that do not
define the term using the current NAREIT definition or that interpret the
current NAREIT definition differently than the Company.  FFO does not
represent cash generated from operating activities using accounting
principles generally accepted in the United States of America and should
not be considered as an alternative to net income as an indication of the
Companys financial performance, or to cash flow from operating activities
as a measure of the Companys liquidity, nor is it indicative of funds
available to fund the Companys cash needs, including its ability to make
cash distributions.  FFO includes both recurring and non-recurring items,
except those results defined as extraordinary items under accounting
principles generally accepted in the United States of America and gains
and losses from sales of depreciable operating property.


     The following table presents the Companys Funds from Operations for
the periods presented below:

                                  Three months ended  Six months ended
                                      June 30,             June 30,
                                  ---------------------------------------
                                      2003      2002     2003     2002
                                  ---------------------------------------
                                                  ($000s)
Funds from Operations:
   Net income                       ($1,164)  $  341   $   356  $   951
   Minority interest                    (43)      20         8       56
                                  ---------------------------------------
Net income before minority
  interest                           (1,207)     361       364    1,007
Adjustments to derive funds from
 operations:
  Add:
   Real estate depreciation
    and amortization:
     Consolidated entities            2,608    1,499     5,215    2,999
     Unconsolidated entities              -    1,122         -    2,244
   Impairment charge on real estate   2,021        -     2,021        -
   Loss on sale of real estate
    property                              -      250        38      250
                                -----------------------------------------
Funds from operations before
 allocation to minority interest      3,422    3,232     7,638    6,500
Funds from operations allocable
 to minority interest                  (128)    (152)     (278)    (323)
                                -----------------------------------------
Funds from operations
 attributable to the common
 shareholders                         3,294    3,080     7,360    6,177
                                -----------------------------------------

     The following table presents information from the Companys statement
of cash flows for the periods presented:

                                  Three months ended  Six months ended
                                      June 30,             June 30,
                                  ---------------------------------------
                                      2003      2002     2003     2002
                                  ---------------------------------------
                                                   ($000s)
Other Data:
  Cash flow provided by operating
    activities                       3,496     2,803    6,825    4,681
  Cash flow provided by (used in)
    investing activities              (158)     (299)    (365)     437
  Cash flow used in financing
    activities                      (2,308)   (1,602)  (7,510)  (4,719)

                                   22

     The following is a summary of capital expenditures for the periods
presented:

                                For the three months  For the six months
                                  ended June 30,         ended June 30,
                                ---------------------------------------
                                    2003      2002     2003     2002
                                ---------------------------------------
                                             (in thousands)
Recurring capital expenditures:
  Furniture, fixtures and
    equipment                     $   72     $    3   $   78   $   17
  Capital improvements               123          2      199        2
                                ---------------------------------------
                                     195          5      277       19
                                ---------------------------------------
Major renovations                      4         67       27      165
                                ---------------------------------------
Total capital expenditures        $  199     $   72   $  304   $  184
                                ---------------------------------------

     Recurring capital expenditures include those expenditures made in
the normal course of operations for corporate/administrative items and
for routine improvements to the Companys existing properties.

     Major renovations include those expenditures which are larger in
scope than recurring capital expenditures both in dollar value and time
to complete and generally enhance the marketability and revenue producing
capacity or useful life of the property.

Summary Condensed Consolidated Financial Data of Genesis

     As leases with Genesis represent a significant portion of the
Companys consolidated assets and revenues, the Company has included
certain summary condensed consolidated financial data of Genesis for
the periods discussed below.  The summary condensed consolidated
financial data of Genesis was taken from Genesis quarterly report on
Form 10-Q for the quarter ended March 31, 2003 as filed with the
Securities and Exchange Commission (the Commission) under the Securities
Exchange Act of 1934, as amended (the Exchange Act).

     Genesis is subject to the information filing requirements of the
Exchange Act, and in accordance therewith, is obligated to file periodic
reports, proxy statements and other information with the Commission
relating to its business, financial condition and other matters.  Such
reports, proxy statements and other information may be inspected at the
offices of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549.  The SEC also maintains an Internet web site that contains reports,
proxy statements and other information regarding issuers, like Genesis, that
file electronically with the SEC.  The address of that site is
http://www.sec.gov.

                                   23

     The following table sets forth certain summary condensed
consolidated financial data for Genesis as of and for the quarters
ended March 31, 2003 and 2002.

                                For the three months  For the six months
                                  ended March 31,      ended March 31,
                                -----------------------------------------
                                    2003      2002     2003     2002
                                -----------------------------------------
                                     (unaudited, in thousands,
                                  except share and per share data)
Operations Data
--------------------------------
Net revenues                     $647,552  $620,419 $1,288,563 $1,229,865
Operating income before
 restructuring and capital costs   51,889    60,588    101,965    120,415
Debt restructuring,
 reorganization and other costs         -     1,700          -      1,700
Net gain (loss) from break-up
 fee and other settlements            969   (21,678)   (11,337)   (21,678)
Depreciation and amortization      16,083    14,686     32,195     29,309
Lease expense                       6,957     6,368     13,903     13,084
Interest expense, net               9,889    10,862     20,809     21,928
Income before income taxes,
 minority interest and equity in
 net income of unconsolidated
 affiliates                        17,991    48,650     46,395     76,072
                                -----------------------------------------
Income tax                          7,018    18,974     18,095     29,668
Income before minority interest
 and equity in net loss of
 unconsolidated affiliates         10,973    29,676     28,300     46,404
                                -----------------------------------------
Equity in net income (loss) of
 unconsolidated affiliates            541      (141)       592        391
Minority interest                  (1,180)     (595)    (2,295)      (752)
                                -----------------------------------------
Net income from continuing
 operations before preferred
 stock dividends                   10,334    28,940     26,597     46,043
Preferred stock dividends             666       630      1,349      1,260
                                -----------------------------------------
Net income (loss) from
 continuing operations              9,668    28,310     25,248     44,783
Loss from discontinued operations  (5,004)   (3,367)    (8,647)    (4,241)
                                -----------------------------------------
Net income available to common
 shareholders                      $4,664   $24,943    $16,601    $40,542
                                ==========================================

Per common share data:
  Basic:
   Income from continuing
    operations                      $0.23     $0.69      $0.61      $1.09
   Loss from discontinued
    operations                     ($0.12)   ($0.08)    ($0.21)    ($0.10)
   Net income                       $0.11     $0.61      $0.40      $0.99
   Weighted average shares     41,641,179 41,168,498  41,594,523 41,102,279
  Diluted:
   Income from continuing
    operations                      $0.23     $0.67      $0.61      $1.07
   Loss from discontinued
    operations                     ($0.12)   ($0.08)    ($0.21)    ($0.10)
   Net income                       $0.11     $0.59      $0.40      $0.97
   Weighted average shares
    income from continuing
    operations                 41,641,179 43,300,745  43,829,594 43,230,208
   Weighted average shares
    net income                 41,641,179 43,300,745  41,594,523 43,230,208
_______________

                                   24


                                           March 31,      September 30,
                                        ---------------------------------
                                               2003         2002
                                        ---------------------------------
                                        (unaudited, dollars in thousands)
Balance Sheet Data
----------------------------------------
  Working capital                           $ 439,771     $ 449,006
  Total assets                              1,929,525     1,989,495
  Long-term debt                              571,616       648,939
  Shareholders equity                         914,965       914,123


ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

     The Companys bonds payable and most of the Companys mortgages bear
interest at fixed rates.  The Company is exposed to market risks related
to fluctuations in interest rates on its variable rate mortgages.  The
Company utilizes interest rate cap provisions within its debt agreements
to limit the impact that interest rate fluctuations have on its variable
rate mortgages.  The Company does not utilize interest rate swaps, forward
or option contracts on foreign currencies or commodities, or any other
type of derivative financial instruments.  Refer to the Companys Annual
Report on Form 10-K for the year ended December 31, 2002 for discussion
of the market risk associated with these financial instruments.

     For fixed rate debt, changes in interest rates generally affect the
fair market value of the underlying indebtedness, but not earnings or cash
flows.  The Company generally cannot prepay fixed rate debt prior to
maturity without premium.  Therefore, interest rate risk and changes in
fair market value should not have a significant impact on the fixed rate
debt until the Company would be required to refinance such debt.  The
carrying value of the Companys fixed rate mortgages, bonds and note payable
at June 30, 2003 is $108 million.  The fair value of fixed rate debt is
approximately $116.6 million at June 30, 2003.

     For variable rate debt, changes in interest rates generally do not
impact fair market value, but do affect future earnings and cash flows.
The weighted average interest rate on variable rate mortgages at June 30,
2003 was 4.4%.  Assuming the variable rate mortgage balances outstanding
at June 30, 2003 of $28.2 million remain constant each one percentage
point increase in interest rates would result in a increase in interest
expense for the next twelve months of approximately $282,000.

     The Company may borrow additional money with variable interest rates
in the future.  Increases in interest rates, therefore, would result in
increases in interest expense, which could adversely affect the Companys
cash flow and its ability to pay its obligations.

ITEM 4.  Controls and Procedures

     Our principal executive officer and principal financial officer,
D. Lee McCreary, Jr., evaluated as of June 30, 2003 the effectiveness of
the design and operations of our controls and other procedures that are

                                   25

designed to ensure that information required to be disclosed by us in
the reports that we file or submit under the Securities Exchange Act of
1934 is recorded, processed, summarized and reported within the time
periods specified in the SECs rules and forms.  As a result of this
evaluation, Mr. McCreary concluded that, as of such date, the design and
operation of our disclosure controls and procedures were effective.

     There were no changes in our internal controls over financial
reporting identified in connection with the evaluation referred to above
that have materially affected, or are reasonably likely to materially
affect, our internal controls over financial reporting.

                       PART II - OTHER INFORMATION

ITEM 4. Submission of Matters to a Vote of Security Holders

     The Company held its annual meeting of shareholders on May 23, 2003.
At the meeting, shareholders elected two trustees, approved the 2003
share option and incentive plan and approved a shareholder proposal
requesting that the Board of Trustees immediately pursue a sale or merger
of the Company.

     The following nominees for trustee, who were elected for a term of
three years and until their successors are duly elected and qualified,
received the following votes at the meeting:

                                    For             Withhold Authority
                              -----------------   ----------------------
D. Lee McCreary, Jr.	         6,064,762               1,457,073
Rodman W. Moorhead, III          6,158,371               1,363,464

     The trustees whose term of office continued after the meeting are
Michael R. Walker, Harold L. Zuber, Jr., James J. Clymer, John G. Foos
and Edward J. Rodgers.

     The following votes were cast on the approval of the 2003 share
option and incentive plan:

                         For       Against      Abstain    Broker Non-Votes
                      ---------  -----------  -----------  ----------------
                      5,109,943   2,404,625       7,267               0

The following votes were cast on the shareholder proposal:

                         For       Against      Abstain    Broker Non-Votes
                      ---------  -----------  -----------  ----------------
                      2,355,541   2,098,797      35,792       3,031,705


ITEM  6.	Exhibits and Reports on Form 8-K

(a) Exhibits

                                   26

     The exhibits filed with this report are listed in the exhibit
index on page 29.

(b)	Reports on Form 8-K

     The following report on Form 8-K was filed during the quarter ended
June 30, 2003:

        Date of Filing          Items Reported/Financial Statements Filed
        --------------          -----------------------------------------
        April 30, 2003          Item 12. Results of Operations and
                                Financial Condition (furnished under
                                Item 9.  Regulation FD Disclosure)

                                    27


                                       SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized on August 14, 2003.


                                     ELDERTRUST


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



                                   28

                                EXHIBIT INDEX

Exhibit No.      Description

2.1              Letter of Intent dated July 11, 2003 between ElderTrust
                  Operating Limited Partnership and Genesis Health
                  Ventures, Inc. (incorporated herein by reference to
                  exhibit 99.1 to the Companys Form 8-K filed with the
                  SEC on July 14, 2003)
10.1+            2003 Share Option and Incentive Plan
10.2+            Amendment No. 2 to 1999 Share Option and Incentive Plan
11.1             Computation of basic and diluted earnings per share
31.1             Rule 13a-14(a)/15d-14(a) certifications
32.1             Written Statement of Chief Executive Officer and Chief
                  Financial Officer Pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002
_________________
+     Represents a management contract or compensatory plan, contract
      or arrangement.


                                   29


EXHIBIT 10.1

                               ELDERTRUST

                    2003 SHARE OPTION AND INCENTIVE PLAN


SECTION 1.	GENERAL PURPOSE OF THE PLAN; DEFINITIONS

     The name of the plan is the ElderTrust 2003 Share Option and
Incentive Plan  (the Plan). The purpose of the Plan is to encourage
and enable the officers, employees, Non-Employee Trustees, consultants
and advisors of ElderTrust (the Company), and the employees, consultants
and advisors of ElderTrust Operating Limited Partnership (the Operating
Partnership) and the Companys other Subsidiaries, upon whose judgment,
initiative and efforts the Company largely depends for the successful
conduct of its business to acquire a proprietary interest in the Company.
It is anticipated that providing such persons with a direct stake in the
Companys welfare will assure a closer identification of their interests
with those of the Company, thereby stimulating their efforts on the
Companys behalf and strengthening their desire to remain with the Company.

     The following terms shall be defined as set forth below:

     Act means the Securities Exchange Act of 1934, as amended from time
to time.

     Administrator means either the Board or the Committee, to the extent
the Committee has been delegated authority pursuant to Section 2.

     Award or Awards, except where referring to a particular category of
grant under the Plan, shall include Incentive Share Options, Non-Qualified
Share Options, Restricted Share Awards, Deferred Share Awards, Unrestricted
Share Awards, Performance Share Awards and Distribution Equivalent Rights.

     Board means the Board of Trustees of the Company as constituted from
time to time.

     Change of Control is defined in Section 15.

     Code means the Internal Revenue Code of 1986, as amended from time
to time, and any successor Code, and related rules, regulations and
interpretations.

     Committee means the Committee of the Board referred to in Section
2 (b).

	Company means ElderTrust, a Maryland real estate investment trust,
and any successor thereto.

	Deferred Share Award means Awards granted pursuant to Section 7.

	Distribution Equivalent Right means Awards granted pursuant to
Section 10.

	Effective Date means the date on which the Plan is initially
approved by Shareholders as set forth in Section 17.

	Fair Market Value on any given date means the last reported sale
price at which Shares are traded on such date or, if no Shares are traded
on such date, the next preceding date on which Shares were traded, as
reflected on the principal stock exchange or, if applicable, any other
national stock exchange on which the Shares are traded or admitted to
trading.

	Incentive Share Option means any Share Option that qualifies as
and is designated in writing in the related Option agreement as
constituting an incentive stock option as defined in Section 422 of
the Code.

	Non-Employee Trustee means a member of the Board who is not also
an employee of the Company or any Subsidiary.

	Non-Qualified Share Option means any Share Option that is not an
Incentive Share Option.

	Operating Partnership means ElderTrust Operating Limited Partnership,
a Delaware limited partnership, and any successor thereto.

	Option or Share Option means any option to purchase Shares granted
pursuant to Section 5.

	Performance Share Award means Awards granted pursuant to Section 9.

	Restricted Share Award means Awards granted pursuant to Section 6.

	Shares means the common shares of beneficial interest, par value
$.01 per share, of the Company, subject to adjustments pursuant to
Section 3.

	Subsidiary means any corporation or other entity (other than the
Company) in any unbroken chain of corporations or other entities
beginning with the Company if each of the corporations or entities
(other than the last corporation or entity in the unbroken chain) owns
shares or other interests possessing 50 percent or more of the economic
interest or the total combined voting power of all classes of shares or
other interests in one of the other corporations or entities in the
chain.

Unrestriced Share Award means any Award granted pursuant to Section 8.

SECTION 2. 	ADMINISTRATION OF PLAN; ADMINISTRATOR AUTHORITY TO SELECT
            PARTICIPANTS AND DETERMINE AWARDS

     (a) The Plan shall be administered by the Board, which shall have
the full power and authority to take all actions and to make all
determinations required or provided for under the Plan or any Award
granted or agreement entered into hereunder and all such other actions
and determinations not inconsistent with the specific terms and
provisions of the Plan deemed by the Board to be necessary or
appropriate to the administration of the Plan or any Award granted or
agreement entered into hereunder.

     (b) The Board from time to time may appoint a Committee consisting
of two or more members of the Board. The Board may delegate to the
Committee such powers and authorities related to the administration of
the Plan, as set forth in Section 2(a) above, as the Board shall
determine, consistent with the By-Laws of the Company and applicable law.
In the event that the Plan or any Award granted or agreement entered into
hereunder provides for any action to be taken by or determination to be
made by the Board, such action may be taken by or such determination may
be made by the Committee if the power and authority to do so has been
delegated to the Committee by the Board as provided for in this Section
2.

     (c) Powers of Administrator. The Administrator shall have the power
and authority to grant Awards consistent with the terms of the Plan,
including the power and authority:

     (i) to select the individuals to whom Awards may from time to time
be granted;

     (ii) to determine the time or times of grant, and the extent, if
any, of Incentive Share Options, Non-Qualified Share Options, Restricted
Share Awards, Deferred Share Awards, Unrestricted Share Awards,
Performance Share Awards and Distribution Equivalent Rights, or any
combination of the foregoing, granted to any one or more participants;

     (iii) to determine the number of Shares to be covered by any Award;

     (iv) to determine and modify from time to time the terms and
conditions, including restrictions, not inconsistent with the terms of
the Plan, of any Award, which terms and conditions may differ among
individual Awards and participants, and to approve the form of written
instruments evidencing the Awards;

     (v) to accelerate at any time the exercisability or vesting of all
or any portion of any Award;

     (vi) subject to the provisions of Section 5(a)(ii), to extend at any
time the post-termination period in which Share Options may be exercised;

     (vii) to determine at any time whether, to what extent, and under
what circumstances Shares and other amounts payable with respect to an
Award shall be deferred either automatically or at the election of the
participant and whether and to what extent the Company shall pay or credit
amounts constituting deemed interest (at rates determined by the
Administrator) or distributions or deemed distributions on such deferrals;
and

     (viii) at any time to adopt, alter and repeal such rules, guidelines
and practices for administration of the Plan and for its own acts and
proceedings as it shall deem advisable; to interpret the terms and
provisions of the Plan and any Award (including related written
instruments); to make all determinations it deems advisable for the
administration of the Plan; to decide all disputes arising in connection
with the Plan; and to otherwise supervise the administration of the Plan.

     All decisions and interpretations of the Administrator shall be made
in the Administrators sole and absolute discretion and shall be final and
binding on all persons, including the Company and Plan participants.

SECTION 3.	SHARES ISSUABLE UNDER THE PLAN; RECAPITALIZATIONS; MERGERS;
            SUBSTITUTE AWARDS

     (a) Shares Issuable. The maximum number of Shares reserved and
available for issuance under the Plan shall be 250,000 Shares. For
purposes of this limitation, if any portion of an Award is forfeited,
canceled, reacquired by the Company, satisfied without the issuance of
Shares or otherwise terminated, the Shares underlying such portion of the
Award shall be added back to the Shares available for issuance under the
Plan. Subject to such overall limitation, Shares may be issued for up to
150,000 Shares pursuant to Awards other than Awards of Share Options;
provided, however, that, Shares Options with respect to no more than
100,000 Shares may be granted to any one individual participant during
any one calendar year period. The Shares available for issuance under the
Plan may be authorized but unissued Shares or Shares reacquired by the
Company.

     (b) Recapitalizations. If, through, or as a result of any merger,
consolidation, sale of all or substantially all of the assets of the
Company, reorganization, recapitalization, reclassification, share
dividend, share split, reverse share split or other similar transaction,
the outstanding Shares are increased or decreased or are exchanged for a
different number or kind of shares or other securities of the Company, or
additional shares or new or different shares or other securities of the
Company or other non-cash assets are distributed with respect to such
Shares or other securities, the Administrator may make an appropriate or
proportionate adjustment in (i) the maximum number of Shares reserved for
issuance under the Plan, (ii) the number of Share Options that can be
granted to any one individual participant, (iii) the number and kind of
shares or other securities subject to any then outstanding Awards under
the Plan, and (iv) the price for each share subject to any then outstanding
Share Options under the Plan, without changing the aggregate exercise price
(i.e., the exercise price multiplied by the number of Share Options) as to
which such Share Options remain exercisable. The adjustment by the
Administrator shall be final, binding and conclusive. No fractional Shares
shall be issued under the Plan resulting from any such adjustment, but the
Administrator in its discretion may make a cash payment in lieu of
fractional shares.

     (c) Mergers. In contemplation of and subject to the consummation of
a consolidation or merger or sale of all or substantially all of the
assets of the Company in which outstanding shares are exchanged for
securities, cash or other property of an unrelated corporation or
business entity or in the event of a liquidation of the Company (in
each case, a Transaction), the Board, or the board of directors of any
entity assuming the obligations of the Company, may, in its discretion,
take any one or more of the following actions, as to outstanding Awards:
(i) provide that such Awards shall be assumed or equivalent awards shall
be substituted, by the acquiring or succeeding corporation (or an
affiliate thereof), and/or (ii) upon written notice to the participants,
provide that all Awards will terminate immediately prior to the consummation
of the Transaction. In the event that, pursuant to clause (ii) above, Awards
will terminate immediately prior to the consummation of the Transaction,
all vested Awards, other than Share Options, shall be fully settled in
cash or in kind at such appropriate consideration as determined by the
Administrator in its sole discretion after taking into account the
consideration payable per Share pursuant to the business combination
(the Merger Price) and all Share Options shall be fully settled, in
cash or in kind, in an amount equal to the difference between (A) the
Merger Price times the number of Shares subject to such outstanding
Share Options (to the extent then exercisable at prices not in excess
of the Merger Price) and (B) the aggregate exercise price of all such
outstanding Share Options; provided, however, that each participant
shall be permitted, within a specified period determined by the
Administratorprior to the consummation of the Transaction, to exercise
all outstanding Share Options, including those that are not then
exercisable, subject to the consummation of the Transaction.

     (d) Substitute Awards. The Administrator may grant Awards under the
Plan in substitution for Shares and Share based awards held by employees
of another corporation who become employees of the Company or a Subsidiary
as the result of a merger or consolidation of the employing corporation
with the Company or a Subsidiary or the acquisition by the Company or a
Subsidiary of property or Shares of the employing corporation. The
Administrator may direct that the substitute awards be granted on such
terms and conditions as the Administrator considers appropriate in the
circumstances.

SECTION 4.	ELIGIBILITY

     Participants in the Plan will be such full or part-time officers
and other employees, Non-Employee Trustees, consultants and advisors of
the Company, the Operating Partnership and the Companys other Subsidiaries
who are responsible for or contribute to the management, growth or
profitability of the Company, the Operating Partnership and the Companys
other Subsidiaries as are selected from time to time by the Administrator
in its sole discretion.

SECTION 5.	SHARE OPTIONS

     Any Share Option granted under the Plan shall be in such form as the
Administrator may from time to time approve.

     Share Options granted under the Plan may be either Incentive Share
Options or Non-Qualified Share Options. Incentive Share Options may be
granted only to employees of the Company or any Subsidiary that is a
subsidiary corporation within the meaning of Section 424(f) of the Code.
To the extent that any Option does not qualify as an Incentive Share Option,
it shall be deemed a Non-Qualified Share Option.

     No Incentive Share Option shall be granted under the Plan after March
27, 2013.

     (a) Share Options Granted to Employees, Consultants, Advisors and
Non-Employee Trustees. The Administrator in its discretion may grant
Share Options to eligible employees, consultants and advisors of the
Company or any Subsidiary and to Non-Employee Trustees. Share Options
granted pursuant to this Section 5(a) shall be subject to the following
terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the terms of the Plan, as the
Administrator shall deem desirable. If the Administrator so determines,
Share Options may be granted in lieu of cash compensation at the
participants election, subject to such terms and conditions as the
Administrator may establish, as well as in addition to other compensation.

     (i) Exercise Price. The exercise price per share for the Shares
covered by a Share Option granted pursuant to this Section 5(a) shall
be determined by the Administrator at the time of grant but shall not
be less than 100 percent of the Fair Market Value on the date of grant.
If an employee owns or is deemed to own (by reason of the attribution
rules of Section 424(d) of the Code) more than 10 percent of the
combined voting power of all classes of Shares of the Company or any
parent or subsidiary corporation and an Incentive Share Option is
granted to such employee, the exercise price of such Incentive Share
Option shall be not less than 110 percent of the Fair Market Value on
the grant date.

     (ii) Option Term. The term of each Share Option shall be fixed by
the Administrator, but no Incentive Share Option shall be exercisable
more than ten years after the date the Share Option is granted. If an
employee owns or is deemed to own (by reason of the attribution rules
of Section 424(d) of the Code) more than 10 percent of the combined
voting power of all classes of Shares of the Company or any parent or
subsidiary corporation and an Incentive Share Option is granted to such
employee, the term of such Share Option shall be no more than five years
from the date of grant.

     (iii) Exercisability; Rights of a Shareholder. Share Options shall
become exercisable at such time or times, whether or not in installments,
as shall be determined by the Administrator at or after the grant date;
provided, however, that Share Options granted in lieu of compensation
shall be exercisable in full as of the grant date unless the Administrator
otherwise provides in the Option Award agreement. The Administrator may
at any time accelerate the exercisability of all or any portion of any
Share Option. A participant shall have the rights of a Shareholder only
as to Shares acquired upon the exercise of a Share Option and not as to
unexercised Share Options.

     (iv) Method of Exercise. Share Options may be exercised in whole or
in part, by giving written notice of exercise to the Company, specifying
the number of shares to be purchased. Payment of the purchase price may
be made by one or more of the following methods to the extent provided
in the Option Award agreement:

     (A) In cash, by certified or bank check or other instrument
acceptable to the Administrator;

     (B) In the form of Shares that are not then subject to restrictions
under any Company plan and that have been beneficially owned by the
participant for at least six months, if permitted by the Administrator in
its discretion. Such surrendered Shares shall be valued at Fair Market
Value on the exercise date;

     (C) By the participant delivering to the Company a properly executed
exercise notice together with irrevocable instructions to a broker to
promptly deliver to the Company cash or a check payable and acceptable to
the Company to pay the purchase price; provided that in the event the
participant chooses to pay the purchase price as so provided, the
participant and the broker shall comply with such procedures and enter
into such agreements of indemnity and other agreements as the Administrator
shall prescribe as a condition of such payment procedure; provided further,
however, that an executive officer or trustee of the Company may not use
the cashless exercise method to pay the exercise price of his Share Option
unless he has obtained the express prior consent of the Company; or

     (D) By the participant delivering to the Company a promissory note if
the Administrator has expressly authorized the loan of funds to the
participant for the purpose of enabling or assisting the participant to
effect the exercise of his Share Option; provided that at least so much of
the exercise price as represents the par value of the Shares shall be paid
other than with a promissory note; provided that an executive officer or
trustee of the Company may not use this exercise method to pay the exercise
price of his Share Option.

     Payment instruments will be received subject to collection. The
delivery of certificates representing the Shares to be purchased pursuant
to the exercise of a Share Option will be contingent upon receipt from
the participant (or a purchaser acting in his stead in accordance with
the provisions of the Share Option) by the Company of the full purchase
price for such shares and the fulfillment of any other requirements
contained in the Share Option or applicable provisions of laws.

     (v) Annual Limit on Incentive Share Options. To the extent required
for incentive stock option treatment under Section 422 of the Code, the
aggregate Fair Market Value (determined as of the time of grant) of the
Shares with respect to which Incentive Share Options granted under this
Plan and any other plan of the Company or its parent and subsidiary
corporations become exercisable for the first time by a participant
during any calendar year shall not exceed $100,000. To the extent that
any Share Option exceeds this limit, it shall constitute a Non-Qualified
Share Option.

     (b) Non-transferability of Share Options.  No Share Option shall be
transferable by the participant otherwise than by will or by the laws
of descent and distribution and all Share Options shall be exercisable,
during the participants lifetime, only by the participant. Notwithstanding
the foregoing, the Administrator, in its sole discretion, may provide in
the Award agreement regarding a given Share Option that the participant
may transfer, without consideration for the transfer, his Non-Qualified
Share Options to members of his family, to trusts for the benefit of such
family members, or to partnerships in which such family members are the
only partners, provided that the transferee agrees in writing with the
Company to be bound by all of the terms and conditions of this Plan and
the applicable Option Award agreement.

     (c) Termination.  Except as may otherwise be provided by the
Administrator either in the Award agreement, or, subject to Section
13 below, in writing after the Award agreement is issued, a participants
rights in all Share Options shall automatically terminate upon the
participants termination of employment (or cessation of business
relationship) with the Company and its Subsidiaries for any reason.

SECTION 6. 	RESTRICTED SHARE AWARDS

     (a) Nature of Restricted Share Awards. A Restricted Share Award is
an Award entitling the recipient to acquire, at par value or such other
higher purchase price determined by the Administrator, Shares subject to
such restrictions and conditions as the Administrator may determine at
the time of grant (Restricted Shares). Conditions may be based on
continuing employment (or other business relationship) and/or achievement
of pre-established performance goals and objectives. Such performance
goals and objectives shall be established in writing by the Administrator
prior to the ninetieth day of the year in which the grant is made and
while the outcome is substantially uncertain. Performance goals and
objectives shall be based on Share price, market share, sales, earnings
per Share, return on equity, costs, or any combination of these factors.
Performance goals and objectives may include positive results, maintaining
the status quo or limiting economic losses. The grant of a Restricted Share
Award is contingent on the participant executing the Restricted Share Award
agreement. The terms and conditions of each such agreement shall be
determined by the Administrator, and such terms and conditions may differ
among individual Awards and participants.

     (b) Rights as a Shareholder.  Upon execution of the Restricted Share
Award agreement and paying any applicable purchase price, a participant
shall have the rights of a Shareholder with respect to the voting of the
Restricted Share, subject to such terms and conditions as may be contained
in the Restricted Share Award agreement. Unless the Administrator shall
otherwise determine, certificates evidencing the Restricted Shares shall
remain in the possession of the Company until such Restricted Shares are
vested as provided in Section 6(d) below, and the participant shall be
required, as a condition of the grant, to deliver to the Company a Share
power endorsed in blank.

     (c) Restrictions.  Restricted Shares may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as
specifically provided herein or in the Restricted Share Award agreement.
If a participants employment (or other business relationship) with the
Company and its Subsidiaries terminates for any reason, the Company shall
have the right to repurchase Restricted Shares that have not vested at the
time of termination at their original purchase price, from the participant
or the participants legal representative.

     (d) Vesting of Restricted Shares.  The Administrator at the time of
grant shall specify the date or dates and/or the attainment of pre-
established performance goals, objectives and other conditions on which
the non-transferability of the Restricted Shares and the Companys right
of repurchase or forfeiture shall lapse. Subsequent to such date or dates
and/or the attainment of such pre-established performance goals, objectives
and other conditions, the shares on which all restrictions have lapsed
shall no longer be Restricted Shares and shall be deemed vested. Except as
may otherwise be provided by the Administrator either in the Award agreement
or, subject to Section 13 below, in writing after the Award agreement is
issued, a participants rights in any shares of Restricted Shares that have
not vested shall automatically terminate upon the participants termination
of employment (or other business relationship) with the Company and its
Subsidiaries and such shares shall be subject to the Companys right of
repurchase as provided in Section 6(c) above.

     (e) Waiver, Deferral and Reinvestment of Distributions.  The
Restricted Share Award agreement may require or permit the immediate
payment, waiver, deferral or reinvestment (in the form of additional
Restricted Shares) of distributions paid on the Restricted Shares.

SECTION 7. 	DEFERRED SHARE AWARDS

     (a) Nature of Deferred Share Awards.  A Deferred Share Award is an
Award of phantom Share units to a participant, subject to restrictions
and conditions as the Administrator may determine at the time of grant.
Conditions may be based on continuing employment (or other business
relationship) and/or achievement of pre-established performance goals
and objectives. The grant of a Deferred Share Award is contingent on the
participant executing the Deferred Share Award agreement. The terms and
conditions of each such agreement shall be determined by the Administrator,
and such terms and conditions may differ among individual Awards and
participants. At the end of the deferral period, the Deferred Share Award,
to the extent vested, shall be paid to the participant in the form of
Shares.

     (b) Election to Receive Deferred Share Awards in Lieu of Compensation.
The Administrator may, in its sole discretion, permit a participant to
elect to receive a portion of the cash compensation or Restricted Share
Award otherwise due to such participant in the form of a Deferred Share
Award. Any such election shall be made in writing and shall be delivered
to the Company no later than the date specified by the Administrator and
in accordance with rules and procedures established by the Administrator.
The Administrator shall have the sole right to determine whether and under
what circumstances to permit such elections and to impose such limitations
and other terms and conditions thereon as the Administrator deems
appropriate.

     (c) Rights as a Shareholder.  During the deferral period, a
participant shall have no rights as a Shareholder; provided, however,
that the participant may be credited with Distribution Equivalent Rights
with respect to the phantom Share units underlying his Deferred Share
Award, subject to such terms and conditions as the Administrator may
determine.

     (d) Restrictions.  A Deferred Share Award may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of during the
deferral period.

     (e) Termination.  Except as may otherwise be provided by the
Administrator either in the Award agreement or, subject to Section 13
below, in writing after the Award agreement is issued, a participants
right in all Deferred Share Awards that have not vested shall
automatically terminate upon the participants termination of employment
(or cessation of business relationship) with the Company and its
Subsidiaries for any reason.

SECTION 8. 	UNRESTRICTED SHARE AWARDS

     Grant or Sale of Unrestricted Shares. The Administrator may, in its
sole discretion, grant (or sell at par value or such other higher purchase
price determined by the Administrator) an Unrestricted Share Award to any
participant pursuant to which such participant may receive Shares free of
any restrictions (Unrestricted Shares) under the Plan. Unrestricted Share
Awards may be granted or sold as described in the preceding sentence in
respect of past services or other valid consideration, or in lieu of any
cash compensation due to such participant.

SECTION 9.	PERFORMANCE SHARE AWARDS

     (a) Nature of Performance Share Awards.  A Performance Share Award
is an Award entitling the recipient to acquire Shares upon the attainment
of specified performance goals. The Administrator may make Performance
Share Awards independent of or in connection with the granting of any
other Award under the Plan. The Administrator in its sole discretion
shall determine whether and to whom Performance Share Awards shall be
made, the performance goals applicable under each such Award, the periods
during which performance is to be measured, and all other limitations
and conditions applicable to the awarded Performance Shares; provided,
however, that the Administrator may rely on the performance goals and
other standards applicable to other performance unit plans of the Company
in setting the standards for Performance Share Awards under the Plan.

     (b) Rights as a Shareholder.  A participant receiving a Performance
Share Award shall have the rights of a Shareholder only as to shares
actually received by the participant under the Plan and not with respect
to shares subject to the Award but not actually received by the
participant. A participant shall be entitled to receive a Share
certificate evidencing the acquisition of Shares under a Performance
Share Award only upon satisfaction of all conditions specified in the
written instrument evidencing the Performance Share Award (or in a
performance plan adopted by the Administrator).

     (c) Termination.  Except as may otherwise be provided by the
Administrator either in the Award agreement or, subject to Section 13
below, in writing after the Award agreement is issued, a participants
rights in all Performance Share Awards shall automatically terminate
upon the participants termination of employment (or cessation of business
relationship) with the Company and its Subsidiaries for any reason.

     (d) Acceleration, Waiver, Etc.  At any time prior to the participants
dermination of employment (or other business relationship) by the Company
and its Subsidiaries, the Administrator may in its sole discretion
accelerate, waive or, subject to Section 13, amend any or all of the
goals, restrictions or conditions imposed under any Performance Share
Award.

SECTION 10.  DISTRIBUTION EQUIVALENT RIGHTS

     (a) Distribution Equivalent Rights.  A Distribution Equivalent Right
is an Award entitling the recipient to receive credits based on cash
distributions that would have been paid on the Shares specified in the
Distribution Equivalent Right (or other award to which it relates) if
such shares had been issued to and held by the recipient. A Distribution
Equivalent Right may be granted hereunder to any participant as a
component of another Award or as a freestanding award. The terms and
conditions of Distribution Equivalent Rights shall be specified in the
grant. Distribution equivalents credited to the holder of a Distribution
Equivalent Right may be paid currently or may be deemed to be reinvested
in additional Shares, which may thereafter accrue additional equivalents.
Any such reinvestment shall be at Fair Market Value on the date of
reinvestment. Distribution Equivalent Rights may be settled in cash or
Shares or a combination thereof, in a single installment or installments,
all determined in the sole discretion of the Administrator. A Distribution
Equivalent Right granted as a component of another Award may provide that
such Distribution Equivalent Right shall be settled upon exercise,
settlement, or payment of, or lapse of restrictions on, such other award,
and that such Distribution Equivalent Right shall expire or be forfeited or
annulled under the same conditions as such other award. A Distribution
Equivalent Right granted as a component of another Award may also contain
terms and conditions different from such other award.

     (b) Interest Equivalents.  Any Award under this Plan that is settled
in whole or in part in cash on a deferred basis may provide in the grant
for interest equivalents to be credited with respect to such cash payment.
Interest equivalents may be compounded and shall be paid upon such terms
and conditions as may be specified by the grant.

     (c) Termination.  Except as may otherwise be provided by the
Administrator either in the Award agreement or, subject to Section 13
below, in writing after the Award agreement is issued, a participants
rights in all Distribution Equivalent Rights or interest equivalents shall
automatically terminate upon the participants termination of  employment
(or cessation of business relationship) with the Company and its
Subsidiaries for any reason.

SECTION 11.  TAX WITHHOLDING

     (a) Payment by Participant.  Each participant shall, no later than
the date as of which the value of an Award or of any Shares or other
amounts received thereunder first becomes includable in the gross income
of the participant for Federal income tax purposes, pay to the Company,
or make arrangements satisfactory to the Administrator regarding payment
of, any Federal, state, or local taxes of any kind required by law to be
withheld with respect to such income. The Company and its Subsidiaries
shall, to the extent permitted by law, have the right to deduct any such
taxes from any payment of any kind otherwise due to the participant. The
Companys obligation to deliver Share certificates to any participant is
subject to and conditioned on tax obligations being satisfied by the
participant.

     (b) Payment in Shares.  Subject to approval by the Administrator,
a participant may elect to have such tax withholding obligation satisfied,
in whole or in part, by (i) authorizing the Company to withhold from
Shares to be issued pursuant to any Award a number of shares with an
aggregate Fair Market Value (as of the date the withholding is effected)
that would satisfy the withholding amount due, or (ii) transferring to
the Company Shares owned by the participant with an aggregate Fair Market
Value (as of the date the withholding is effected) that would satisfy the
withholding amount due.

SECTION 12.  TRANSFER, LEAVE OF ABSENCE, ETC.

     For purposes of the Plan, the following events shall not be deemed
a termination of employment:

     (a) a transfer to the employment of the Company from a Subsidiary
or from the Company to a Subsidiary, or from one Subsidiary to another;
or

     (b) an approved leave of absence for military service or sickness,
or for any other purpose approved by the Company, if the employees right
to reemployment is guaranteed either by a statute or by contract or under
the written policy pursuant to which the leave of absence was granted or
if the Administrator otherwise so provides in writing.

SECTION 13.  AMENDMENTS AND TERMINATION

     The Board may, at any time, amend or discontinue the Plan and the
Administrator may, at any time, amend or cancel any outstanding Award for
the purpose of satisfying changes in law or for any other lawful purpose,
but no such action shall adversely affect rights under any outstanding
Award without the holders written consent. Nothing in this Section 13
shall limit the Boards authority to take any action permitted pursuant
to Section 3(c).

SECTION 14.  STATUS OF PLAN

     Unless the Administrator shall otherwise expressly determine in
writing, with respect to the portion of any Award which has not been
exercised and any payments in cash, Shares or other consideration not
received by a participant, a participant shall have no rights greater
than those of a general creditor of the Company. In its sole discretion,
the Administrator may authorize the creation of trusts or other
arrangements to meet the Companys obligations to deliver Shares or make
payments with respect to Awards hereunder, provided that the existence
of such trusts or other arrangements is consistent with the foregoing
sentence.

SECTION 15.  CHANGE OF CONTROL PROVISIONS

     (a) Upon the occurrence of a Change of Control as defined in this
Section 15 or as otherwise defined in the Award agreement, each Award
shall be subject to such terms, if any, with respect to a Change of
Control as have been provided by the Administrator either in the Award
agreement or, subject to Section 13 above, in writing after the Award
agreement is issued.

     (b) Change of Control shall mean the occurrence of any one of the
following events:

     (i) any person (as such term is used in Sections 13(d) and 14(d)
of the Act), becomes the beneficial owner (as defined in Rule 13d-3
under the Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the combined voting power
of the Companys then outstanding securities; (ii) during any two (2)
year period, individuals who at the beginning of such period constitute
the Board of Trustees, including for this purpose any new trustee whose
election resulted from a vacancy on the Board of Trustees caused by the
mandatory retirement, death, or disability of a trustee and was approved
by a vote of at least two-thirds (2/3rds) of the trustees then still in
office who were trustees at the beginning of the period, cease for any
reason to constitute a majority thereof; (iii) notwithstanding clauses
(i) or (v) of this Section 15(b), the Company consummates a merger or
consolidation of the Company with or into another corporation or trust,
the result of which is that the shareholders of the Company at the time
of the execution of the agreement to merge or consolidate own less than
eighty percent (80%) of the total equity of the entity surviving or
resulting from the merger or consolidation or of a entity owning,
directly or indirectly, one hundred percent (100%) of the total equity
of such surviving or resulting entity; (iv) the sale in one or a series
of transactions of all or substantially all of the assets of the Company;
(v) any person, has commenced a tender or exchange offer, or entered
into an agreement or received an option to acquire beneficial ownership
of fifty percent (50%) or more of the total number of voting shares of
the Company unless the Board of Trustees has made a determination that
such action does not constitute and will not constitute a change in the
persons in control of the Company; or (vi) there is a change of control
in the Company of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Act other than in circumstances specifically covered by
clauses (i) - (v) above.

SECTION 16.  GENERAL PROVISIONS

     (a) No Distribution; Compliance with Legal Requirements. The
Administrator may require each person acquiring Shares pursuant to an
Award to represent to and agree with the Company in writing that such
person is acquiring the shares without a view to distribution thereof.

     No Shares shall be issued pursuant to an Award until all applicable
securities law and other legal and stock exchange or similar requirements
have been satisfied. The Administrator may require the placing of such
stop-orders and restrictive legends on certificates for Shares and Awards
as it deems appropriate.

     (b) Delivery of Share Certificates. Share certificates to be
delivered to participants under this Plan shall be deemed delivered for
all purposes (i) when the Company or a Share transfer agent of the Company
shall have mailed such certificates in  the United States mail, addressed
to the participant, at the participants last known address on file with
the Company, or (ii) when the Company records the issuance of Shares in
the participants name using the book entry method.

     (c) Other Compensation Arrangements; No Employment Rights.  Nothing
contained in this Plan shall prevent the Board from adopting other or
additional compensation arrangements, including trusts, and such
arrangements may be either generally applicable or applicable only in
specific cases. The adoption of this Plan and the grant of Awards shall
not confer upon any employee any right to continued employment with the
Company or any Subsidiary and shall not interfere in any way with the right
of the Company or any Subsidiary to terminate the employment of any of its
employees at any time.

     (d) Trading Policy Restrictions. Option exercises and other Awards
under the Plan shall be subject to such Company insider-trading-policy-
related restrictions, terms  and conditions as may be established by the
Administrator, or in accordance with policies set by the Administrator,
from time to time.

SECTION 17.  EFFECTIVE DATE OF PLAN

     This Plan shall become effective upon approval by the holders of a
majority of the votes cast at a meeting of Shareholders at which a quorum
is present. Subject to such approval by the Shareholders and to the
requirement that no Share may be issued hereunder prior to such approval,
Share Options and other Awards may be granted hereunder on and after
adoption of this Plan by the Board.

SECTION 18.  GOVERNING LAW

     This Plan and all Awards and actions taken thereunder shall be
governed by, and construed in accordance with, the laws of the State of
Maryland, applied without regard to conflict of law principles.

                                  * * * * *

EXHIBIT 10.2

                             AMENDMENT NO. 2
                                   TO

                 1999 SHARE OPTION AND INCENTIVE PLAN

     ElderTrust, a Maryland real estate investment trust (the Company),
hereby amends the terms of the ElderTrust 1999 Share Option and Incentive
Plan (the 1999 Plan) as follows:

1.  Section 3(c) of the 1999 Plan is hereby amended by replacing the
phrase In the event that, at the beginning of the last sentence of
Section 3(c) with the following new phrase:

     Except as otherwise provided in the Award agreement, in the event
that,

2.  In all other respects the 1999 Plan is unchanged.

                              *   *   *

     This Amendment No. 2 to 1999 Share Option and Incentive Plan was
duly adopted and approved by the Board of Trustees of the Company on
April 28, 2003.


                                    /s/ D. Lee McCreary, Jr
                                    ------------------------
                                    D. Lee McCreary, Jr.
                                    Secretary


EXHIBIT 11.1


                      COMPUTATION OF BASIC AND DILUTED
                      NET INCOME (LOSS) PER SHARE FOR
            THE THREE AND SIX MONTHS ENDED JUNE 30, 2003 AND 2002

     The following calculation is submitted in accordance with
requirements of the Securities Exchange Act of 1934:

                                          For the three    For the six
                                          months ended     months ended
                                              June 30,       June 30,
                                          -----------------------------
                                           2003   2002    2003    2002
                                          -----------------------------
Basic net income (loss) per share:
------------------------------------------
Weighted average common shares outstanding   7,712  7,361  7,655  7,349
                                          =============================

 Net income (loss) from continuing
   operations                             ($1,164)  $575    $428 $1,180

 Basic net income (loss) from continuing
  operations per share                     ($0.15) $0.08   $0.06  $0.16

 Loss from discontinued operations              -  ($234)    $72  ($229)
 Basic loss from discontinued
   operations per share                         - ($0.03) ($0.01)($0.03)

 Net income (loss)                        ($1,164)  $341    $356   $951
 Basic net income (loss) per share         ($0.15) $0.05   $0.05  $0.13

Diluted net income (loss) per share:
-----------------------------------------
 Weighted average common shares
  outstanding                               7,712  7,361   7,655  7,349

 Common stock equivalents - stock options
  and warrants                                  -    344      61    343
                                          -----------------------------
Total weighted average number of diluted
 Shares                                     7,712  7,705   7,716  7,692
                                          =============================

  Net income (loss) from continuing
   operations                             ($1,164)  $575    $428 $1,180

  Diluted net income (loss) from
   continuing operations per share         ($0.15) $0.07   $0.06  $0.15


  Loss from discontinued operations             -  ($234)   ($72) ($229)
  Diluted loss from discontinued
   operations per share                         - ($0.03) ($0.01)($0.03)

  Net income (loss)                       ($1,164)  $341    $356   $951
  Diluted net income (loss) per share      ($0.15) $0.04   $0.05  $0.12


EXHIBIT 31.1

                              CERTIFICATIONS


I, D. Lee McCreary, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of ElderTrust;

2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under my supervision,
to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to me by others within those
entities, particularly during the period in which this report is being
prepared;

(b) evaluated the effectiveness of the registrants disclosure controls
and procedures and presented in this report my conclusions about the
effectiveness of the disclosure controls and procedures, as of the end
of the period covered by this report based on such evaluation; and

(c) disclosed in this report any change in the registrants internal
control over financial reporting that occurred during the registrants
most recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant's internal
control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal
control over financial reporting, to the registrant's auditors and the
audit committee of the registrants board of directors (or persons
performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrants ability to record,
process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrants internal
control over financial reporting.


Date:	August 14, 2003                /s/ D. LEE MCCREARY, JR.
                                     -----------------------------------
                                     D. Lee McCreary, Jr.
                                     President, Chief Executive Officer,
                                     Chief Financial Officer, Treasurer
                                     and Secretary


EXHIBIT 32.1


Written Statement of Chief Executive Officer and Chief Financial Officer
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


The undersigned Chief Executive Officer and Chief Financial Officer of
ElderTrust (the Company), certifies that, to his knowledge, on the
date hereof:

(a) the Form 10-Q of the Company for the quarter ended June 30, 2003
filed on August 14, 2003 with the Securities and Exchange Commission
(the Report) fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

(b) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.


August 14, 2003                       /s/ D. Lee McCreary, Jr.
_______________                       ________________________________
Date                                  D. Lee McCreary, Jr.
                                      President, Chief Executive
                                      Officer, Chief Financial
                                      Officer, Treasurer and Secretary