<PAGE>

                                  ELDERTRUST

                          AMENDED AND RESTATED BYLAWS

                  ElderTrust, a real estate investment trust organized under
the laws of the State of Maryland (the "Trust") having The Corporation Trust
Incorporated as its resident agent located at 32 South Street, Baltimore,
Maryland 21202, hereby adopts the following as the Amended and Restated Bylaws
(as the same may be amended from time to time, the "Bylaws") of the Trust:


                                   ARTICLE I

                                    OFFICES

                  Section 1. PRINCIPAL OFFICE. The principal office ElderTrust
(the "Trust") shall be located at such place or places as the Trustees may
designate.

                  Section 2. ADDITIONAL OFFICES. The Trust may have additional
offices at such places as the Trustees may from time to time determine or the
business of the Trust may require.


                                  ARTICLE II

                           MEETINGS OF SHAREHOLDERS

                  Section 1. PLACE. All meetings of shareholders shall be held
at the principal office of the Trust or at such other place within the United
States as shall be stated in the notice of the meeting.

                  Section 2. ANNUAL MEETING. The Trust shall hold its first
annual meeting of shareholders in January 1998. Thereafter, an annual meeting
of the shareholders for the election of Trustees and the transaction of any
business within the powers of the Trust shall be held during the month of May
of each year, after the delivery of the annual report referred to in Section
12 of this Article II, at a convenient location and on proper notice, on a
date and at the time set by the Trustees, beginning with the year 1999.
Failure to hold an annual meeting does not invalidate the Trust's existence or
affect any otherwise valid acts of the Trust.

                  Section 3. SPECIAL MEETINGS. The Chairman of the Board or
the President or one-third of the Trustees may call special meetings of the
shareholders. Special meetings of shareholders shall also be called by the
Secretary upon the written request of the holders of shares entitled to cast
not less than a majority of all the votes entitled to be cast at such meeting.
Such request shall state the purpose of such meeting and the matters proposed
to be acted on at such meeting. Within ten (10) days of the receipt of such a
request, the Secretary shall inform such shareholders of the reasonably
estimated cost of preparing and mailing notice of the meeting (including all
proxy materials that may be required in connection therewith) and, upon
payment by such shareholders to the Trust of such costs, the Secretary shall,
within thirty (30) days of such payment, or such longer period as may be
necessitated by compliance with any applicable statutory or regulatory
requirements, give notice to each shareholder entitled to notice of the
meeting.
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                  Unless requested by shareholders entitled to cast a majority
of all the votes entitled to be cast at such meeting, a special meeting need
not be called to consider any matter which is substantially the same as a
matter voted on at any meeting of the shareholders held during the preceding
twelve months.

                  Section 4. NOTICE. Not less than ten nor more than 90 days
before each meeting of shareholders, the Secretary shall give to each
shareholder entitled to vote at such meeting and to each shareholder not
entitled to vote who is entitled to notice of the meeting written or printed
notice stating the time and place of the meeting and, in the case of a special
meeting or as otherwise may be required by any statute, the purpose for which
the meeting is called, either by mail or by presenting it to such shareholder
personally or by leaving it at his residence or usual place of business. If
mailed, such notice shall be deemed to be given when deposited in the United
States mail addressed to the shareholder at his post office address as it
appears on the records of the Trust, with postage thereon prepaid.

                  Section 5. SCOPE OF NOTICE. Any business of the Trust may be
transacted at an annual meeting of shareholders without being specifically
designated in the notice, except such business as is required by any statute
to be stated in such notice. No business shall be transacted at a special
meeting of shareholders except as specifically designated in the notice.

                  Section 6. ORGANIZATION. At every meeting of the
shareholders, the Chairman of the Board, if there be one, shall conduct the
meeting or, in the case of vacancy in office or absence of the Chairman of the
Board, one of the following officers present shall conduct the meeting in the
order stated: the Vice Chairman of the Board, if there be one, the Chief
Executive Officer, if there be one, the President, the Vice Presidents in
their order of rank and seniority, or a Chairman chosen by the shareholders
entitled to cast a majority of the votes which all shareholders present in
person or by proxy are entitled to cast, shall act as Chairman, and the
Secretary, or, in his absence, an Assistant Secretary, or in the absence of
both the Secretary and Assistant Secretaries, a person appointed by the
Chairman shall act as Secretary.
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                  Section 7. QUORUM. At any meeting of shareholders, the
presence in person or by proxy of shareholders entitled to cast a majority of
all the votes entitled to be cast at such meeting shall constitute a quorum;
but this section shall not affect any requirement under any statute or the
declaration of trust ("Declaration of Trust") for the vote necessary for the
adoption of any measure. If, however, such quorum shall not be present at any
meeting of the shareholders, the shareholders entitled to vote at such
meeting, present in person or by proxy, shall have the power to adjourn the
meeting from time to time to a date not more than 120 days after the original
record date without notice other than announcement at the meeting. At such
adjourned meeting at which a quorum shall be present, any business may be
transacted which might have been transacted at the meeting as originally
notified.

                  Section 8. VOTING. Subject to the rights of the holders of
any series of Preferred Shares (as defined in the Declaration of Trust) to
elect additional Trustees under specified circumstances, a plurality of all
the votes cast at a meeting of shareholders duly called and at which a quorum
is present shall be sufficient to elect a Trustee. Each share may be voted for
as many individuals as there are Trustees to be elected and for whose election
the share is entitled to be voted. A majority of the votes cast at a meeting
of shareholders duly called and at which a quorum is present shall be
sufficient to approve any other matter which may properly come before the
meeting, unless more than a majority of the votes cast is required herein or
by statute or by the Declaration of Trust. Unless otherwise provided in the
Declaration of Trust, each outstanding share, regardless of class, shall be
entitled to one vote on each matter submitted to a vote at a meeting of
shareholders.

                  Section 9. PROXIES. A shareholder may cast the votes
entitled to be cast by the shares owned of record by him either in person or
by proxy executed in writing by the shareholder or by his duly authorized
attorney in fact. Such proxy shall be filed with the Secretary of the Trust
before or at the time of the meeting. No proxy shall be valid after eleven
months from the date of its execution, unless otherwise provided in the proxy.

                  Section 10. VOTING OF SHARES BY CERTAIN HOLDERS. Shares of
the Trust registered in the name of a corporation, partnership, trust or other
entity, if entitled to be voted, may be voted by the president or a vice
president, a general partner or trustee thereof, as the case may be, or a
proxy appointed by any of the foregoing individuals, unless some other person
who has been appointed to vote such shares pursuant to a bylaw or a resolution
of the governing board of such corporation or other entity or agreement of the
partners of the partnership presents a certified copy of such bylaw,
resolution or agreement, in which case such person may vote such shares. Any
trustee or other fiduciary may vote shares registered in his name as such
fiduciary, either in person or by proxy.

                  Shares of the Trust directly or indirectly owned by it shall
not be voted at any meeting and shall not be counted in determining the total

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number of outstanding shares entitled to be voted at any given time, unless
they are held by it in a fiduciary capacity, in which case they may be voted
and shall be counted in determining the total number of outstanding shares at
any given time.

                  The Trustees may adopt by resolution a procedure by which a
shareholder may certify in writing to the Trust that any shares registered in
the name of the shareholder are held for the account of a specified person
other than the shareholder. The resolution shall set forth the class of
shareholders who may make the certification, the purpose for which the
certification may be made, the form of certification and the information to be
contained in it; if the certification is with respect to a record date or
closing of the share transfer books, the time after the record date or closing
of the share transfer books within which the certification must be received by
the Trust; and any other provisions with respect to the procedure which the
Trustees consider necessary or desirable. On receipt of such certification,
the person specified in the certification shall be regarded as, for the
purposes set forth in the certification, the shareholder of record of the
specified shares in place of the shareholder who makes the certification.

                  Notwithstanding any other provision contained herein or in
the Declaration of Trust or these Bylaws, Title 3, Subtitle 7 of the
Corporations and Associations Article of the Annotated Code of Maryland (or
any successor statute) shall not apply to any acquisition by any person of
shares of beneficial interest of the Trust. This section may be repealed, in
whole or in part, at any time, whether before or after an acquisition of
control shares and, upon such repeal, may, to the extent provided by any
successor bylaw, apply to any prior or subsequent control share acquisition.

                  Section 11. INSPECTORS. At any meeting of shareholders, the
chairman of the meeting may appoint one or more persons as inspectors for such
meeting. Such inspectors shall ascertain and report the number of shares
represented at the meeting based upon their determination of the validity and
effect of proxies, count all votes, report the results and perform such other
acts as are proper to conduct the election and voting with impartiality and
fairness to all the shareholders.

                  Each report of an inspector shall be in writing and signed
by him or by a majority of them if there is more than one inspector acting at
such meeting. If there is more than one inspector, the report of a majority
shall be the report of the inspectors. The report of the inspector or
inspectors on the number of shares represented at the meeting and the results
of the voting shall be prima facie evidence thereof.

                  Section 12. REPORTS TO SHAREHOLDERS. The Trustees shall
submit to the shareholders at or before the annual meeting of shareholders a
report of the business and operations of the Trust during the prior fiscal

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year, containing a balance sheet and a statement of income and surplus of the
Trust, accompanied by the certification of an independent certified public
accountant, and such further information as the Trustees may determine is
required pursuant to any law or regulation to which the Trust is subject.
Within the earlier of 20 days after the annual meeting of shareholders or 120
days after the end of the fiscal year of the Trust, the Trustees shall place
the annual report on file at the principal office of the Trust and with any
governmental agencies as may be required by law and as the Trustees may deem
appropriate.

                  Section 13.  NOMINATIONS AND PROPOSALS BY SHAREHOLDERS.

                  (a) Annual Meetings of Shareholders. (1) Nominations of
persons for election to the Board of Trustees and the proposal of business to
be considered by the shareholders may be made at an annual meeting of
shareholders (i) pursuant to the Trust's notice of meeting, (ii) by or at the
direction of the Trustees or (iii) by any shareholder of the Trust who was a
shareholder of record both at the time of giving of notice provided for in
this Section 13 (a) and at the time of the annual meeting, who is entitled to
vote at the meeting and who complied with the notice procedures set forth in
this Section 13(a).

                            (2) For nominations or other business to be
properly brought before an annual meeting by a shareholder pursuant to clause
(iii) of paragraph (a) (1) of this Section 13, the shareholder must have given
timely notice thereof in writing to the Secretary of the Trust and such other
business must otherwise be a proper matter for action by shareholders. To be
timely, a shareholder's notice shall be delivered to the Secretary at the
principal executive offices of the Trust not later than the close of business
on the 60th day nor earlier than the close of business on the 90th day prior
to the first anniversary of the preceding year's annual meeting; provided,
however, that in the event that the date of the annual meeting is advanced by
more than 30 days or delayed by more than 60 days from such anniversary date
or if the Trust has not previously held an annual meeting, notice by the
shareholder to be timely must be so delivered not earlier than the close of
business on the 90th day prior to such annual meeting and not later than the
close of business on the later of the 60th day prior to such annual meeting or
the tenth day following the day on which public announcement of the date of
such meeting is first made by the Trust. In no event shall the public
announcement of a postponement or adjournment of an annual meeting to a later
date or time commence a new time period for the giving of a shareholder's
notice as described above. Such shareholder's notice shall set forth as to
each person whom the shareholder proposes to nominate for election or
reelection as a Trustee all information relating to such person that is
required to be disclosed in solicitations of proxies for election of Trustees
in an election contest, or is otherwise required, in each case pursuant to
Regulation 14A under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (including such person's

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written consent to being named in the proxy statement as a nominee and to
serving as a Trustee if elected); (ii) as to any other business that the
shareholder proposes to bring before the meeting, a brief description of the
business desired to be brought before the meeting, the reasons for conducting
such business at the meeting and any material interest in such business of
such shareholder and of the beneficial owner, if any, on whose behalf the
proposal is made; and (iii) as to the shareholder giving the notice and the
beneficial owner, if any, on whose behalf the nomination or proposal is made,
(x) the name and address of such shareholder, as they appear on the Trust's
books, and of such beneficial owner and (y) the number of each class of shares
of the Trust which are owned beneficially and of record by such shareholder
and such beneficial owner.

                           (3)  Notwithstanding  anything  in the  second
sentence  of  paragraph  (a) (2) of this Section 13 to the contrary, in the
event that the number of Trustees to be elected to the Board of Trustees is
increased and there is no public announcement by the Trust naming all of the
nominees for Trustee or specifying the size of the increased Board of Trustees
at least 70 days prior to the first anniversary of the preceding year's annual
meeting, a shareholder's notice required by this Section 13(a) shall also be
considered timely, but only with respect to nominees for any new positions
created by such increase, if it shall be delivered to the Secretary at the
principal executive offices of the Trust not later than the close of business on
the tenth day following the day on which such public announcement is first made
by the Trust.

                  (b) Special Meetings of Shareholders. Only such business
shall be conducted at a special meeting of shareholders as shall have been
brought before the meeting pursuant to the Trust's notice of meeting.
Nominations of persons for election to the Board of Trustees may be made at a
special meeting of shareholders at which Trustees are to be elected (i)
pursuant to the Trust's notice of meeting (ii) by or at the direction of the
Board of Trustees or (iii) provided that the Board of Trustees has determined
that Trustees shall be elected at such special meeting, by any shareholder of
the Trust who was a shareholder of record both at the time of giving of notice
provided for in this Section 13(b) and at the time of the special meeting, who
is entitled to vote at the meeting and who complied with the notice procedures
set forth in this Section 13 (b). In addition to the foregoing requirements,
for nominations or other business to be properly brought before a special
meeting by a shareholder, such shareholder's notice containing the information
required by paragraph (a) (2) of this Section 13 must be delivered to the
Secretary at the principal executive offices of the Trust not earlier than the
close of business on the 90th day prior to such special meeting and not later
than the close of business on the later of the 60th day prior to such special
meeting or the tenth day following the day on which public announcement is
first made of the date of the special meeting. In no event shall the public
announcement of a postponement or adjournment of a special meeting to a later
date or time commence a new time period for the giving of a shareholder's
notice as described above.
<PAGE>

                  (c) General. (1) Only such persons who are nominated in
accordance with the procedures set forth in this Section 13 shall be eligible
to serve as Trustees and only such business shall be conducted at a meeting of
shareholders as shall have been brought before the meeting in accordance with
the procedures set forth in this Section 13. The chairman of the meeting shall
have the power and duty to determine whether a nomination or any business
proposed to be brought before the meeting was made or proposed, as the case
may be, in accordance with the procedures set forth in this Section 13 and, if
any proposed nomination or business is not in compliance with this Section 13,
to declare that such nomination or proposal shall be disregarded.

                           (2) For purposes of this Section 13, "public
announcement" shall mean disclosure in a press release reported by the Dow
Jones News Service, Associated Press or comparable news service or in a
document publicly filed by the Trust with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

                           (3) Notwithstanding the foregoing provisions of
this Section 13, a shareholder shall also comply with all applicable
requirements of state law and of the Exchange Act and the rules and
regulations thereunder with respect to the matters set forth in this Section
13. Nothing in this Section 13 shall be deemed to affect any rights of
shareholders to request inclusion of proposals in, nor any of the rights of
the Trust to omit a proposal from, the Trust's proxy statement pursuant to
Rule 14a-8 under the Exchange Act.

                  Section 14. INFORMAL ACTION BY SHAREHOLDERS. Subject to the
rights of the holders of any series of Preferred Shares to elect additional
Trustees under specified circumstances and notwithstanding the provisions of
Section 13 of this Article II, any action required or permitted to be taken at
a meeting of shareholders may be taken without a meeting if a consent in
writing, setting forth such action, is signed by all shareholders entitled to
vote on such matter; provided, that all shareholders entitled to notice of any
such meeting but not entitled to vote on such matter shall have made a written
waiver of any right to dissent to such action taken without a meeting.

                  Section 15. VOTING BY BALLOT. Voting on any question or in
any election at a meeting of shareholders may be viva voce unless the
presiding officer shall order or any shareholder present of such meeting in
person or by proxy shall demand that voting be by ballot.
<PAGE>


                                  ARTICLE III

                                   TRUSTEES

                  Section 1. GENERAL POWERS; QUALIFICATIONS; TRUSTEES HOLDING
OVER. The business and affairs of the Trust shall be managed under the
direction of its Board of Trustees. A Trustee shall be an individual at least
21 years of age who is not under legal disability. In case of failure to elect
Trustees at an annual meeting of the shareholders, the Trustees holding over
shall continue to direct the management of the business and affairs of the
Trust until their successors are elected and qualify.

                  Section 2. NUMBER. At any regular meeting or at any special
meeting called for that purpose, a majority of the entire Board of Trustees
may establish, increase or decrease the number of Trustees, subject to any
limitations on the number of Trustees set forth in the Declaration of Trust.

                  Section 3. ANNUAL AND REGULAR MEETINGS. An annual meeting of
the Trustees shall be held immediately after and at the same place as the
annual meeting of shareholders, no notice other than this Bylaw being
necessary. The Trustees may provide, by resolution, the time and place, either
within or without the State of Maryland, for the holding of regular meetings
of the Trustees without other notice than such resolution.

                  Section 4. SPECIAL MEETINGS. Special meetings of the
Trustees may be called by or at the request of the Chairman of the Board, the
Chief Executive Officer or the President or by a majority of the Trustees then
in office. The person or persons authorized to call special meetings of the
Trustees may fix any place, either within or without the State of Maryland, as
the place for holding any special meeting of the Trustees called by them.

                  Section 5. NOTICE. Notice of any special meeting shall be
given by written notice delivered personally, telegraphed,
facsimile-transmitted or mailed to each Trustee at his business or residence
address. Personally delivered or telegraphed notices shall be given at least
two days prior to the meeting. Notice by mail shall be given at least five
days prior to the meeting. Telephone or facsimile-transmission notice shall be
given at least 24 hours prior to the meeting. If mailed, such notice shall be
deemed to be given when deposited in the United States mail properly
addressed, with postage thereon prepaid. If given by telegram, such notice
shall be deemed to be given when the telegram is delivered to the telegraph
company. Telephone notice shall be deemed given when the Trustee is personally
given such notice in a telephone call to which he is a party.
Facsimile-transmission notice shall be deemed given upon completion of the
transmission of the message to the number given to the Trust by the Trustee
and receipt of a completed answer-back indicating receipt. Neither the
business to be transacted at, nor the purpose of, any annual, regular or

<PAGE>

special meeting of the Trustees need be stated in the notice, unless
specifically required by statute or these Bylaws.

                  Section 6. QUORUM. A majority of the Trustees shall
constitute a quorum for convening any meeting of the Trustees, provided that,
if less than a majority of such Trustees are present at said meeting, a
majority of the Trustees present may adjourn the meeting from time to time
without further notice, and provided further that if, pursuant to the
Declaration of Trust or these Bylaws, the vote of a majority of a particular
group of Trustees is required for action, a quorum must also include a
majority of such group.

                  The Trustees present at a meeting which has been duly called
and convened may continue to transact business until adjournment,
notwithstanding the withdrawal of enough Trustees to leave less than a quorum.

                  Section 7. VOTING. The action of the majority of the
Trustees present at a meeting at which a quorum is present when such meeting
is convened shall be the action of the Trustees, unless the concurrence of a
greater proportion is required for such action by applicable statute, the
Declaration of Trust or these Bylaws.

                  Section 8. TELEPHONE MEETINGS. Trustees may participate in a
meeting by means of a conference telephone or similar communications equipment
if all persons participating in the meeting can hear each other at the same
time. Participation in a meeting by these means shall constitute presence in
person at the meeting.

                  Section 9. INFORMAL ACTION BY TRUSTEES. Any action required
or permitted to be taken at any meeting of the Trustees may be taken without a
meeting, if a consent in writing to such action is signed by each Trustee and
such written consent is filed with the minutes of proceedings of the Trustees.

                  Section 10. VACANCIES. If for any reason any or all of the
Trustees cease to be Trustees, such event shall not terminate the Trust or
affect these Bylaws or the powers of the remaining Trustees hereunder (even if
fewer than two Trustees remain). Any vacancy (including a vacancy created by
an increase in the number of Trustees) shall be filled, at any regular meeting
or at any special meeting called for that purpose, by a majority of the
Trustees. Any individual so elected as Trustee shall hold office until the
next annual meeting of Shareholders and until his successor is elected and
qualifies.

                  Section 11. CHAIRMAN AND VICE CHAIRMAN OF THE BOARD. The
Trustees may from time to time appoint a Chairman of the Board and a Vice
Chairman of the Board. The Chairman of the Board shall preside over the
meetings of the Trustees and of the shareholders at which he shall be present

<PAGE>

and shall in general oversee all of the business and affairs of the Trust. In
the absence of the Chairman of the Board, the Vice Chairman of the Board shall
preside at such meetings at which he shall be present. The Chairman and the
Vice Chairman of the Board may execute any deed, mortgage, bond, contract or
other instrument, except in cases where the execution thereof shall be
expressly delegated by the Trustees or by these Bylaws to an officer or some
other agent of the Trust or shall be required by law to be otherwise executed.
The Chairman of the Board and the Vice Chairman of the Board shall perform
such other duties as may be assigned to him or them by the Trustees.

                  Section 12.  COMPENSATION.

                  Trustees shall not receive any stated salary for their
services as Trustees but, by resolution of the Trustees, may receive fixed
sums per year or per meeting or per visit to real property owned or to be
acquired by the Trust and for any service or activity they perform or engage
in as Trustees. Such fixed sums may be paid either in cash or in shares of the
Trust. Trustees may be reimbursed for expenses of attendance, if any, at each
annual, regular or special meeting of the Trustees or of any committee
thereof; and for their expenses, if any, in connection with each property
visit and any other service or activity performed or engaged in as Trustees;
but nothing herein contained shall be construed to preclude any Trustees from
serving the Trust in any other capacity and receiving compensation therefor.

                   Section 13. REMOVAL OF TRUSTEES. The shareholders may, at
any time, remove any Trustee in the manner provided in the Declaration of
Trust. Subject to the rights of the holders of any series of Preferred Shares
to elect additional Trustees resulting from the removal of one or more
Trustees or under other specified circumstances, the shareholders may elect a
successor to fill a vacancy on the Board of Trustees which results from the
removal of a Trustee.

                  Section 14. LOSS OF DEPOSITS. No Trustee shall be liable for
any loss which may occur by reason of the failure of the bank, trust company,
savings and loan association, or other institution with whom moneys or shares
have been deposited.

                  Section 15.  SURETY  BONDS.  Unless  required by law, no
Trustee  shall be  obligated to give any bond or surety or other security for
the performance of any of his duties.

                  Section 16. RELIANCE. Each Trustee, officer, employee and
agent of the Trust shall, in the performance of his duties with respect to the
Trust, be fully justified and protected with regard to any act or failure to

<PAGE>

act in reliance in good faith upon the books of account or other records of
the Trust, upon an opinion of counsel or upon reports made to the Trust by any
of its officers or employees or by the adviser, accountants, appraisers or
other experts or consultants selected by the Trustees or officers of the
Trust, regardless of whether such counsel or expert may also be a Trustee.

                  Section 17. INTERESTED TRUSTEE TRANSACTIONS. Section 2-419
of the Maryland General Corporation Law (the "MGCL") shall be available for
and apply to any contract or other transaction between the Trust and any of
its Trustees or between the Trust and any other trust, corporation, firm or
other entity in which any of its Trustees is a trustee or director or has a
material financial interest.

                  Section 18. CERTAIN RIGHTS OF TRUSTEES, OFFICERS, EMPLOYEES
AND AGENTS. The Trustees shall have no responsibility to devote their full
time to the affairs of the Trust. Any Trustee or officer, employee or agent of
the Trust (other than a full-time officer, employee or agent of the Trust), in
his personal capacity or in a capacity as an affiliate, employee, or agent of
any other person, or otherwise, may have business interests and engage in
business activities similar or in addition to those of or relating to the
Trust.)


                                  ARTICLE IV

                                  COMMITTEES

                  Section 1. NUMBER, TENURE AND QUALIFICATION. The Trustees
may appoint from among its members an Executive Committee, an Audit Committee
and a Compensation Committee, each composed of at least two Trustees, and
other committees, each composed of one or more Trustees, to serve at the
pleasure of the Trustees; provided, that the membership of the Compensation
Committee shall consist of a majority of Independent Trustees and the
membership of the Audit Committee shall consist only of Independent Trustees
so long as they continue in office. An individual shall be deemed to be an
"Independent Trustee" hereunder if such individual is not an affiliate of the
Trust and is not an employee of the Trust.

                  Section 2. POWERS. The Trustees may delegate to committees
appointed under Section 1 of this Article IV any of the powers of the
Trustees, except as prohibited by law.

                  Section 3. MEETINGS. Notice of committee meetings shall be
given in the same manner as notice for special meetings of the Board of
Trustees. One-third, but not less than two (except for one-member committees),
of the members of any committee shall be present in person at any meeting of
such committee in order to constitute a quorum for the transaction of business
at such meeting, and the act of a majority present shall be the act of such
committee. The Board of Trustees may designate a chairman of any committee,

<PAGE>

and such chairman or any two members of any committee (except for one-member
committees) may fix the time and place of its meetings unless the Board shall
otherwise provide. In the absence or disqualification of any member of any
such committee, the members thereof present at any meeting and not
disqualified from voting, whether or not they constitute a quorum, may
unanimously appoint another Trustee to act at the meeting in the place of such
absent or disqualified members.

                  Each committee shall keep minutes of its proceedings and
shall report the same to the Board of Trustees at the next succeeding meeting,
and any action by the committee shall be subject to revision and alteration by
the Board of Trustees, provided that no rights of third persons shall be
affected by any such revision or alteration.

                  Section 4. TELEPHONE MEETINGS. Members of a committee of the
Trustees may participate in a meeting by means of a conference telephone or
similar communications equipment if all persons participating in the meeting
can hear each other at the same time. Participation in a meeting by these
means shall constitute presence in person at the meeting.

                  Section 5. INFORMAL ACTION BY COMMITTEES. Any action
required or permitted to be taken at any meeting of a committee of the
Trustees may be taken without a meeting, if a consent in writing to such
action is signed by each member of the committee and such written consent is
filed with the minutes of proceedings of such committee.

                  Section 6. VACANCIES. Subject to the provisions hereof, the
Board of Trustees shall have the power at any time to change the membership of
any committee, to fill all vacancies, to designate alternate members to
replace any absent or disqualified member or to dissolve any such committee.

                  Section 7. EMERGENCY. In the event of a state of disaster of
sufficient severity to prevent the conduct and management of the affairs and
business of the Trust by its Trustees and officers as contemplated by the
Declaration of Trust and these Bylaws, any two or more available members of
the then incumbent Executive Committee shall constitute a quorum of that
Committee for the full conduct and management of the affairs and business of
the Trust in accordance with the provisions of this Article IV. In the event
of the unavailability, at such time, of a minimum of two members of the then
incumbent Executive Committee, the available Trustees shall elect an Executive
Committee composed of any two members of the Board of Trustees, whether or not
they be officers of the Trust, which two members shall constitute the
Executive Committee for the full conduct and management of the affairs of the
Trust in accordance with the foregoing provisions of this Section 7. This

<PAGE>

Section 7 shall be subject to implementation by resolution of the Board of
Trustees passed from time to time for that purpose, and any provisions of the
Bylaws (other than this Section 7) and any resolutions which are contrary to
the provisions of this Section 7 or to the provisions of any such implementing
resolutions shall be suspended until it shall be determined by any interim
Executive Committee acting under this Section 7 that it shall be to the
advantage of the Trust to resume the conduct and management of its affairs and
business under all the other provisions of these Bylaws.


                                   ARTICLE V

                                   OFFICERS

                  Section 1. GENERAL PROVISIONS. The officers of the Trust
shall include a President, a Secretary and a Treasurer and may include a Chief
Executive Officer, a Chief Operating Officer, a Chief Financial Officer, a
Chief Legal Counsel, one or more Vice Presidents, one or more Assistant
Secretaries and one or more Assistant Treasurers. In addition, the Trustees
may from time to time appoint such other officers with such powers and duties
as they shall deem necessary or desirable. The officers of the Trust shall be
elected annually by the Trustees at the first meeting of the Trustees held
after each annual meeting of shareholders. If the election of officers shall
not be held at such meeting, such election shall be held as soon thereafter as
may be convenient. Each officer shall hold office until his successor is
elected and qualifies or until his death, resignation or removal in the manner
hereinafter provided. Any two or more offices except President and Vice
President may be held by the same person. In their discretion, the Trustees
may leave unfilled any office except that of President and Secretary. Election
of an officer or agent shall not of itself create contract rights between the
Trust and such officer or agent.

                  Section 2. REMOVAL AND RESIGNATION. Any officer or agent of
the Trust may be removed at any time by the Trustees if in their judgment the
best interests of the Trust would be served thereby, but such removal shall be
without prejudice to the contract rights, if any, of the person so removed.
Any officer of the Trust may resign at any time by giving written notice of
his resignation to the Trustees, the Chairman of the Board, the President or
the Secretary. Any resignation shall take effect at any time subsequent to the
time specified therein or, if the time when it shall become effective is not
specified therein, immediately upon its receipt. The acceptance of a
resignation shall not be necessary to make it effective unless otherwise
stated in the resignation. Such resignation shall be without prejudice to the
contract rights, if any, of the Trust.

                  Section 3. VACANCIES. A vacancy in any office may be filled
by the Trustees for the balance of the term.
<PAGE>

                  Section 4. CHIEF EXECUTIVE OFFICER. The Trustees may
designate a Chief Executive Officer from among the elected officers. The Chief
Executive Officer shall have responsibility for implementation of the policies
of the Trust, as determined by the Trustees, and for the administration of the
business affairs of the Trust. In the absence of both the Chairman and Vice
Chairman of the board, the Chief Executive Officer shall preside over the
meetings of the Trustees and of the shareholders at which he shall be present.

                  Section 5. PRESIDENT. In the absence of the Chairman, the
Vice Chairman of the Board and the Chief Executive Officer, the President
shall preside over the meetings of the Trustees and of the shareholders at
which he shall be present. In the absence of a designation of a Chief
Executive Officer by the Trustees, the President shall be the Chief Executive
Officer and shall be ex officio a member of all committees that may, from time
to time, be constituted by the Trustees. The President may execute any deed,
mortgage, bond, contract or other instrument, except in cases where the
execution thereof shall be expressly delegated by the Trustees or by these
Bylaws to some other officer or agent of the Trust or shall be required by law
to be otherwise executed; and in general shall perform all duties incident to
the office of president and such other duties as may be prescribed by the
Chief Executive Officer or the Trustees from time to time.

                  Section 6. CHIEF OPERATING OFFICER. The Trustees may
designate a Chief Operating Officer from among the elected officers. Said
officer will have the responsibilities and duties as set forth by the Chief
Executive Officer, the President or the Trustees.

                  Section 7. VICE PRESIDENTS. In the absence of the President
or in the event of a vacancy in such office, the Vice President (or in the
event there be more than one Vice President, the Vice Presidents in the order
designated at the time of their election or, in the absence of any
designation, then in the order of their election) shall perform the duties of
the President and when so acting shall have all the powers of and be subject
to all the restrictions upon the President; and shall perform such other
duties as from time to time may be assigned to him or her by the Chief
Executive Officer, the President or the Trustees. The Trustees may designate
one or more Vice Presidents as Executive Vice President, Senior Vice President
or as Vice President for particular areas of responsibility.

                  Section 8. TREASURER. The Treasurer shall have the custody
of the funds and securities of the Trust and shall keep full and accurate
accounts of receipts and disbursements in books belonging to the Trust and
shall deposit all moneys and other valuable effects in the name and to the
credit of the Trust in such depositories as may be designated by the Trustees.

                  The Treasurer shall disburse the funds of the Trust as may
be ordered by the Trustees, taking proper vouchers for such disbursements, and

<PAGE>

shall render to the Chief Executive Officer, the President and the Trustees,
at the regular meetings of the Trustees or whenever they may require it, an
account of all his or her transactions as Treasurer and of the financial
condition of the Trust.

                  If required by the Trustees, the Treasurer shall give the
Trust a bond in such sum and with such surety or sureties as shall be
satisfactory to the Trustees for the faithful performance of the duties of his
or her office and for the restoration to the Trust, in case of his or her
death, resignation, retirement or removal from office, of all books, papers,
vouchers, moneys and other property of whatever kind in his or her possession
or under his or her control belonging to the Trust.

                  Section 9. CHIEF FINANCIAL OFFICER. The Trustees may
designate a Chief Financial Officer from among the elected officers. Said
officer will have the responsibilities and duties as set forth by the Chief
Executive Officer, the President or the Trustees.

                  Section 10. CHIEF LEGAL COUNSEL. The Trustees may designate
a Chief Legal Counsel from among the elected officers. Said officer will have
the responsibilities and duties as set forth by the Chief Executive Officer,
the President or the Trustees.

                  Section 11. SECRETARY. The Secretary shall (a) keep the
minutes of the proceedings of the shareholders, the Trustees and committees of
the Trustees in one or more books provided for that purpose; (b) see that all
notices are duly given in accordance with the provisions of these Bylaws or as
required by law; (c) be custodian of the trust records and of the seal of the
Trust; (d) keep a register of the post office address of each shareholder
which shall be furnished to the Secretary by such shareholder; (e) have
general charge of the share transfer books of the Trust; and (f) in general
perform such other duties as from time to time may be assigned to him by the
Chief Executive Officer, the President or the Trustees.

                  Section 12. ASSISTANT SECRETARIES AND ASSISTANT TREASURERS.
The Assistant Secretaries and Assistant Treasurers, in general, shall perform
such duties as shall be assigned to them by the Secretary or Treasurer,
respectively, or by the Chief Executive Officer, the President or the
Trustees. The Assistant Treasurers shall, if required by the Trustees, give
bonds for the faithful performance of their duties in such sums and with such
surety or sureties as shall be satisfactory to the Trustees.

                  Section 13. SALARIES. The salaries and other compensation of
the officers shall be fixed from time to time by the Trustees and no officer
shall be prevented from receiving such salary or other compensation by reason
of the fact that he or she is also a Trustee.
<PAGE>


                                  ARTICLE VI

                     CONTRACTS, LOANS, CHECKS AND DEPOSITS

                  Section 1. CONTRACTS. The Trustees may authorize any officer
or agent to enter into any contract or to execute and deliver any instrument
in the name of and on behalf of the Trust and such authority may be general or
confined to specific instances. Any agreement, deed, mortgage, lease or other
document executed by one or more of the Trustees or by an authorized person
shall be valid and binding upon the Trustees and upon the Trust when
authorized or ratified by action of the Trustees.

                  Section 2. CHECKS AND DRAFTS. All checks, drafts or other
orders for the payment of money, notes or other evidences of indebtedness
issued in the name of the Trust shall be signed by such officer or agent of
the Trust in such manner as shall from time to time be determined by the
Trustees.

                  Section 3. DEPOSITS. All funds of the Trust not otherwise
employed shall be deposited from time to time to the credit of the Trust in
such banks, trust companies or other depositories as the Trustees may
designate.


                                  ARTICLE VII

                                    SHARES

                  Section 1. CERTIFICATES. Each shareholder shall be entitled
to a certificate or certificates which shall represent and certify the number
of shares of each class of beneficial interest held by him in the Trust. Each
certificate shall be signed by the Chief Executive Officer, the President or a
Vice President and countersigned by the Secretary or an Assistant Secretary or
the Treasurer or an Assistant Treasurer and may be sealed with the seal, if
any, of the Trust. The signatures may be either manual or facsimile.
Certificates shall be consecutively numbered; and if the Trust shall, from
time to time, issue several classes of shares, each class may have its own
number series. A certificate is valid and may be issued whether or not an
officer who signed it is still an officer when it is issued. Each certificate
representing shares which are restricted as to their transferability or voting
powers, which are preferred or limited as to their dividends or as to their
allocable portion of the assets upon liquidation or which are redeemable at
the option of the Trust, shall have a statement of such restriction,
limitation, preference or redemption provision, or a summary thereof, plainly
stated on the certificate. In lieu of such statement or summary, the Trust may
set forth upon the face or back of the certificate a statement that the Trust
will furnish to any shareholder, upon request and without charge, a full
statement of such information.
<PAGE>

                  Section 2. TRANSFERS. Certificates shall be treated as
negotiable and title thereto and to the shares they represent shall be
transferred by delivery thereof to the same extent as those of a Maryland
stock corporation. Upon surrender to the Trust or the transfer agent of the
Trust of a share certificate duly endorsed or accompanied by proper evidence
of succession, assignment or authority to transfer, the Trust shall issue a
new certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books.

                  The Trust shall be entitled to treat the holder of record of
any share or shares as the holder in fact thereof and, accordingly, shall not
be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
the State of Maryland.

                  Notwithstanding the foregoing, transfers of shares of
beneficial interest of the Trust will be subject in all respects to the
Declaration of Trust and all of the terms and conditions contained therein.

                  Section 3. REPLACEMENT CERTIFICATE. Any officer designated
by the Trustees may direct a new certificate to be issued in place of any
certificate previously issued by the Trust alleged to have been lost, stolen
or destroyed upon the making of an affidavit of that fact by the person
claiming the certificate to be lost, stolen or destroyed. When authorizing the
issuance of a new certificate, an officer designated by the Trustees may, in
his discretion and as a condition precedent to the issuance thereof, require
the owner of such lost, stolen or destroyed certificate or the owner's legal
representative to advertise the same in such manner as he shall require or to
give bond, with sufficient surety, to the Trust to indemnify it against any
loss or claim which may arise as a result of the issuance of a new
certificate.

                  Section 4. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD
DATE. The Trustees may set, in advance, a record date for the purpose of
determining shareholders entitled to notice of or to vote at any meeting of
shareholders or determining shareholders entitled to receive payment of any
dividend or the allotment of any other rights, or in order to make a
determination of shareholders for any other proper purpose. Such date, in any
case, shall not be prior to the close of business on the day the record date
is fixed and shall be not more than 90 days and, in the case of a meeting of
shareholders not less than ten days, before the date on which the meeting or
particular action requiring such determination of shareholders of record is to
be held or taken.

                  In lieu of fixing a record date, the Trustees may provide
that the share transfer books shall be closed for a stated period but not
longer than 20 days. If the share transfer books are closed for the purpose of
determining shareholders entitled to notice of or to vote at a meeting of

<PAGE>

shareholders, such books shall be closed for at least ten days before the date
of such meeting.

                  If no record date is fixed and the share transfer books are
not closed for the determination of shareholders, (a) the record date for the
determination of shareholders entitled to notice of or to vote at a meeting of
shareholders shall be at the close of business on the day on which the notice
of meeting is mailed or the 30th day before the meeting, whichever is the
closer date to the meeting; and (b) the record date for the determination of
shareholders entitled to receive payment of a dividend or an allotment of any
other rights shall be the close of business on the day on which the resolution
of the Trustees, declaring the dividend or allotment of rights, is adopted.

                  When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof, except when (i) the
determination has been made through the closing of the transfer books and the
stated period of closing has expired or (ii) the meeting is adjourned to a
date more than 120 days after the record date fixed for the original meeting,
in either of which case a new record date shall be determined as set forth
herein.

                  Section 5. SHARE LEDGER. The Trust shall maintain at its
principal office or at the office of its counsel, accountants or transfer
agent, an original or duplicate share ledger containing the name and address
of each shareholder and the number of shares of each class held by such
shareholder.

                  Section 6. FRACTIONAL SHARES; ISSUANCE OF UNITS. The
Trustees may issue fractional shares or provide for the issuance of scrip, all
on such terms and under such conditions as they may determine. Notwithstanding
any other provision of the Declaration of Trust or these Bylaws, the Trustees
may issue units consisting of different securities of the Trust. Any security
issued in a unit shall have the same characteristics as any identical
securities issued by the Trust, except that the Trustees may provide that for
a specified period securities of the Trust issued in such unit may be
transferred on the books of the Trust only in such unit.


                                 ARTICLE VIII

                                  FISCAL YEAR

                  The Trustees shall have the power, from time to time, to fix
the fiscal year of the Trust by a duly adopted resolution.
<PAGE>


                                  ARTICLE IX

                                 DISTRIBUTIONS

                  Section 1. AUTHORIZATION. Dividends and other distributions
upon the shares of beneficial interest of the Trust may be authorized and
declared by the Trustees, subject to the provisions of law and the Declaration
of Trust. Dividends and other distributions may be paid in cash, property or
shares of the Trust, subject to the provisions of law and the Declaration of
Trust.

                  Section 2. CONTINGENCIES. Before payment of any dividends or
other distributions, there may be set aside out of any funds of the Trust
available for dividends or other distributions such sum or sums as the
Trustees may from time to time, in their absolute discretion, think proper as
a reserve fund for contingencies, for equalizing dividends or other
distributions, for repairing or maintaining any property of the Trust or for
such other purpose as the Trustees shall determine to be in the best interest
of the Trust, and the Trustees may modify or abolish any such reserve in the
manner in which it was created.


                                   ARTICLE X

                    PROHIBITED INVESTMENTS AND ACTIVITIES;
                              INVESTMENT POLICIES

                  Notwithstanding anything to the contrary in the Declaration
of Trust, the Trust shall not enter into any transaction referred to in (i),
(ii) or (iii) below which it does not believe is in the best interests of the
Trust, and will not, without the approval of a majority of the disinterested
Trustees, (i) acquire from or sell to any Trustee, officer or employee of the
Trust, any corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise in which a Trustee, officer or employee of the Trust
owns more than a one percent interest or any affiliate of any of the
foregoing, any of the assets or other property of the Trust, except for the
acquisition directly or indirectly of certain properties or interest therein,
directly or indirectly, through entities in which it owns an interest in
connection with the initial public offering of shares by the Trust or pursuant
to agreements entered into in connection with such offering, which properties
shall be described in the prospectus relating to such initial public offering,
(ii) make any loan to or borrow from any of the foregoing persons or (iii)
engage in any other transaction with any of the foregoing persons. Each such
transaction will be in all respects on such terms as are, at the time of the
transaction and under the circumstances then prevailing, fair and reasonable
to the Trust. Subject to the foregoing and the provisions of the Declaration
of Trust, the Board of Trustees may from time to time adopt, amend, revise or
terminate any policy or policies with respect to investments by the Trust as
it shall deem appropriate in its sole discretion.
<PAGE>


                                  ARTICLE XI

                                     SEAL

                  Section 1. SEAL.  The  Trustees  may  authorize  the  adoption
of a seal by the Trust.  The seal shall have inscribed  thereon the name of
the Trust and the year of its  formation.  The Trustees may authorize one or
more duplicate seals and provide for the custody thereof.

                  Section 2. AFFIXING SEAL. Whenever the Trust is permitted or
required to affix its seal to a document, it shall be sufficient to meet the
requirements of any law, rule or regulation relating to a seal to place the
word "(SEAL)" adjacent to the signature of the person authorized to execute
the document on behalf of the Trust.


                                  ARTICLE XII

                    INDEMNIFICATION AND ADVANCE OF EXPENSES

                  To the maximum extent permitted by Maryland law in effect
from time to time, the Trust shall indemnify (a) any Trustee, officer or
shareholder or any former Trustee, officer or shareholder (including among the
foregoing, for all purposes of this Article XII and without limitation, any
individual who, while a Trustee, officer or shareholder and at the express
request of the Trust, serves or has served another corporation, partnership,
joint venture, trust, employee benefit plan or any other enterprise as a
director, officer, shareholder, partner or trustee of such corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise)
who has been successful, on the merits or otherwise, in the defense of a
proceeding to which he was made a party by reason of service in such capacity,
against reasonable expenses incurred by him in connection with the proceeding,
(b) any Trustee or officer or any former Trustee or officer against any claim
or liability to which he may become subject by reason of such status unless it
is established that (i) his act or omission was material to the matter giving
rise to the proceeding and was committed in bad faith or was the result of
active and deliberate dishonesty, (ii) he actually received an improper
personal benefit in money, property or services or (iii) in the case of a
criminal proceeding, he had reasonable cause to believe that his act or
omission was unlawful and (c) each shareholder or former shareholder against
any claim or liability to which he may become subject by reason of such
status. In addition, the Trust shall, without requiring a preliminary
determination of the ultimate entitlement to indemnification, pay or
reimburse, in advance of final disposition of a proceeding, reasonable
expenses incurred by a Trustee, officer or shareholder or former Trustee,

<PAGE>

officer or shareholder made a party to a proceeding by reason such status,
provided that, in the case of a Trustee or officer, the Trust shall have
received (i) a written affirmation by the Trustee or officer of his good faith
belief that he has met the applicable standard of conduct necessary for
indemnification by the Trust as authorized by these Bylaws and (ii) a written
undertaking by or on his behalf to repay the amount paid or reimbursed by the
Trust if it shall ultimately be determined that the applicable standard of
conduct was not met. The Trust may, with the approval of its Trustees, provide
such indemnification or payment or reimbursement of expenses to any Trustee,
officer or shareholder or any former Trustee, officer or shareholder who
served a predecessor of the Trust and to any employee or agent of the Trust or
a predecessor of the Trust. Neither the amendment nor repeal of this Article,
nor the adoption or amendment of any other provision of the Declaration of
Trust or these Bylaws inconsistent with this Article, shall apply to or affect
in any respect the applicability of this Article with respect to any act or
failure to act which occurred prior to such amendment, repeal or adoption.

                  Any indemnification or payment or reimbursement of the
expenses permitted by these Bylaws shall be furnished in accordance with the
procedures provided for indemnification or payment or reimbursement of
expenses, as the case may be, under Section 2-418 of the MGCL for directors of
Maryland corporations. The Trust may provide to Trustees, officers and
shareholders such other and further indemnification or payment or
reimbursement of expenses, as the case may be, to the fullest extent permitted
by the MGCL, as in effect from time to time, for directors of Maryland
corporations.


                                 ARTICLE XIII

                               WAIVER OF NOTICE

                  Whenever any notice is required to be given pursuant to the
Declaration of Trust or Bylaws or pursuant to applicable law, a waiver thereof
in writing, signed by the person or persons entitled to such notice, whether
before or after the time stated therein, shall be deemed equivalent to the
giving of such notice. Neither the business to be transacted at nor the
purpose of any meeting need be set forth in the waiver of notice, unless
specifically required by statute. The attendance of any person at any meeting
shall constitute a waiver of notice of such meeting, except where such person
attends a meeting for the express purpose of objecting to the transaction of
any business on the ground that the meeting is not lawfully called or
convened.
<PAGE>


                                  ARTICLE XIV

                              AMENDMENT OF BYLAWS

                  The Trustees shall have the exclusive power to adopt, alter
or repeal any provision of these Bylaws and to make new Bylaws.


                                  ARTICLE XV

                                 MISCELLANEOUS

                  All references to the Declaration of Trust shall include any
amendments thereto. In these Bylaws, unless the context otherwise requires,
words used in the singular or in the plural include both the plural and
singular and words denoting any gender include all genders.

                                    * * * *