Explorer Holdings, L.P.
                         4200 Texas Commerce Tower West
                                2200 Ross Avenue
                                  Dallas, Texas

                                November 15, 2000


Omega Healthcare Investors, Inc.
900 Victors Way, Suite 350
Ann Arbor, Michigan 48108
Attn.: Susan Allene Kovach


Dear Susan:

                  By signing in the space  provided  below,  Explorer  Holdings,
L.P.  ("Explorer") hereby consents to the extension of the Dividend Payment Date
applicable to the Series C Preferred Stock of Omega Healthcare  Investors,  Inc.
("OHI") for the  Dividend  Period  ended  October 31,  2000 (the  "October  2000
Dividend  Period"),  until April 2, 2001 (the "Due Date").  Explorer also waives
its right to demand  pursuant to Section 4(d) of the Articles that any dividends
paid on OHI's  issued  and  outstanding  Series A  Preferred  Stock and Series B
Preferred  Stock for the dividend  period ending  October 31, 2000, be paid on a
pro rata basis  together  with the accrued  and unpaid  dividend on the Series C
Preferred Stock for the October 2000 Dividend Period and consents to the payment
in full by OHI of the accrued  dividends  on such  Series A Preferred  Stock and
Series B Preferred Stock in accordance with the terms thereof. Explorer also (i)
waives the  application of the provisions of Section 4(e) of the Articles solely
with respect to the deferral by OHI of the payment of the October 2000  Dividend
Period  Amount (as  defined  below),  (ii)  consents  to the payment by OHI of a
dividend  in  respect  of the  October  2000  Dividend  Period on the issued and
outstanding  Common Stock on November 15, 2000 in the amount of $0.25 per share,
and (iii)  acknowledges  and agrees that the October 2000 Dividend Period Amount
will not be deemed to be an unpaid  dividend for a past Dividend  Period for the
purpose  set  forth in the  first  sentence  of  Section  4(e) of the  Articles.
Notwithstanding  the  foregoing,  OHI  expressly  acknowledges  and agrees that,
without the written  consent of Explorer,  nothing herein will be deemed to be a
waiver of Explorer's  rights (or a consent to a deferral of payment of dividends
other than those in respect of the October 2000 Dividend Period) under Section 4
of the  Articles  with  respect to the Series C  Preferred  Stock for any future
Dividend  Period in which the dividend  relating to such Dividend  Period is not
paid in accordance with the requirements of Section 4 thereof.

                  Subject   to   the   immediately   following   paragraph,   in
consideration of Explorer's consent, OHI hereby agrees to pay, no later than the
Due Date, out of funds legally  available for the payment of dividends,  cash in
an aggregate amount equal to $4,667,000 million which OHI and Explorer expressly
acknowledge  and agree  constitutes  the total  unpaid  preferential  cumulative
dividend  for the October  2000  Dividend  Period  with  respect to the Series C
Preferred Stock (the "October 2000 Dividend Period  Amount"),  plus a waiver fee
on the amount of the daily unpaid principal balance of the October 2000 Dividend
Period  Amount from  November  15, 2000 until the October 2000  Dividend  Period
Amount shall have been paid in full, which waiver fee shall be payable at a rate
of 10% per annum,  compounded  annually and calculated on the basis of a 360 day
year based on the actual number of days elapsed.

                  Furthermore,  in the  event  that (i)  funds  are not  legally
available to OHI to pay all or any of the October 2000  Dividend  Period  Amount
plus the wavier fee as provided  hereinabove or (ii) OHI elects  pursuant to the
first  sentence  of Section  4(b) of the  Articles  not to pay all or any of the
October  2000  Dividend  Period  Amount plus the waiver fee in cash,  OHI hereby
agrees that any portion of the October 2000 Dividend  Period  Amount  (including
any accrued and unpaid  waiver fee) which is not paid in cash on or prior to the
Due Date (the  "Unpaid  Amount")  will be payable by the  issuance as of the Due
Date of additional shares of fully paid,  nonassessable Series C Preferred Stock
having an aggregate liquidation preference equal to such Unpaid Amount (with the
amount of any  fractional  share that might  otherwise be issuable being paid in
cash). In the event that any dividends  (including any accrued and unpaid waiver
fee) are paid in shares of Series C Preferred  Stock pursuant to the immediately
preceding sentence, OHI agrees to take such actions as are necessary to increase
the number of  authorized  shares of Series C  Preferred  Stock by the number of
shares to be issued pursuant hereto,  including but not limited to the filing of
Articles  Supplementary with the State Department of Assessments and Taxation of
Maryland in  accordance  with Article VII of the OHI  Charter.  OHI will deliver
certificates  representing shares of Series C Preferred Stock issued pursuant to
this paragraph promptly after the Due Date. Any payments by OHI of cash pursuant
to this  letter  agreement  shall be  applied  first to the  payment of any then
accrued but unpaid waiver fee with respect to the October 2000  Dividend  Period
Amount and thereafter to the payment of the October 2000 Dividend Period Amount.

                  OHI and Explorer  represent and warrant to each other that (i)
it has the  requisite  power and  authority  to execute and deliver  this letter
agreement,  (ii) the  execution  and delivery of this letter  agreement has been
duly  authorized  by  all  necessary   corporate  or  partnership   action,   as
appropriate,  and (iii) this letter agreement has been duly and validly executed
and  delivered  by  it  and  constitutes  its  valid  and  binding   obligation,
enforceable  against it in accordance with the terms hereof except that (y) such
enforceability  may be subject to  applicable  bankruptcy,  insolvency  or other
similar laws now or hereinafter in effect affecting  creditors' rights generally
and (z) the availability of the remedy of specific  performance or injunctive or
other forms of equitable  relief may be subject to equitable  defenses and would
be subject to the discretion of the court before which any proceeding  therefore
may be brought.

                  This letter  agreement  will be governed by and  construed  in
accordance  with  the laws of the  State  of  Delaware,  without  regard  to its
conflict of laws  principles,  and may not be amended except by an instrument in
writing signed on behalf of each of the parties hereto.  Capitalized  terms used
in this letter agreement and not defined shall have the respective  meanings set
forth in the Articles  Supplementary  for Series C Convertible  Preferred Stock.
This  letter  agreement  may be  executed  by the  parties  hereto  in  separate
counterparts,  each of which when so executed and delivered will be an original,
but all such counterparts will together  constitute one and the same instrument.
A facsimile copy of a signature page shall be deemed to be an original signature
page.

                  By signing in the space below, OHI expressly  acknowledges and
agrees to take any and all actions as are  necessary to implement  the foregoing
obligations. The provisions hereof will be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns and until such
time as the October  2000  Dividend  Period  Amount and all waiver fees  accrued
thereon  are  paid  in  full,   Explorer  will  either  cause  the  certificates
representing  the shares of Series C Preferred Stock to be legended to reference
the  existence  of this  letter  agreement  or will cause a copy of this  letter
agreement to be physically attached to all such certificates.


                                Very truly yours,

                             EXPLORER HOLDINGS, L.P.

                              By:  Explorer Holdings GenPar, LLC,
                                   its General Partner


                              By:  /s/ William T. Cavanaugh, Jr.
                                   -----------------------------
                                   William T. Cavanaugh, Jr.
                                   Vice President

Agreed to and accepted as of this 15th day of November, 2000.

OMEGA HEALTHCARE
INVESTORS, INC.


By:    /s/ Susan Allene Kovach
       ------------------------
       Susan Allene Kovach
       Vice President