AMENDED AND RESTATED ADVISORY AGREEMENT


                  THIS  AMENDED AND  RESTATED  ADVISORY  AGREEMENT,  dated as of
October  4, 2000 (this  "Agreement")  is made and  entered  into  between  Omega
Healthcare  Investors,  Inc., a Maryland  corporation (the  "Company"),  and The
Hampstead Group, L.L.C., a Texas limited liability company (the "Advisor").

     A. Explorer Holdings, L.P. (the "Purchaser"),  an affiliate of the Advisor,
has made a  substantial  equity  investment  in the Company  (the  "Investment")
pursuant  to an  Investment  Agreement,  dated  as of  July  14,  2000,  between
Purchaser and the Company (the "Investment Agreement");

     B. Simultaneously with the Investment,  the Advisor and the Company entered
into an advisory  agreement (the "Prior  Agreement").  This Agreement amends and
restates the Prior  Agreement in its entirety and supersedes the Prior Agreement
in all respects;

     C. The Advisor,  by and through itself, its affiliates and their respective
officers,  employees  and  representatives,   has  expertise  in  the  areas  of
management,  finance,  strategy,  investment  and  acquisitions  relating to the
business of the Company; and

     D.  Pursuant  to the terms of the  Investment  Agreement,  the  Company may
desire to avail itself,  during the term of this Agreement,  of the expertise of
the  Advisor in the  aforesaid  areas and the  Advisor  may wish to provide  the
services to the Company as herein set forth.

     NOW, THEREFORE, in consideration of the foregoing, the parties hereto agree
as follows:

                  1. Advisory Services.  (a) The Advisor may, from time to time,
consider  advising and assisting the Company in connection  with the development
of its strategic plan, including acquisitions, divestitures, new development and
financing matters.  The precise nature of the services to be performed hereunder
by the Advisor will be determined  from time to time by mutual  agreement of the
Advisor  and the  Company.  The  Company  hereby  acknowledges  that the persons
performing  the  foregoing  services are  full-time  employees of the Advisor or
other  entities  and will not be expected to devote  substantially  all of their
efforts to the Company but rather only so much of their efforts as, from time to

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time, the Advisor  determines in its reasonable  discretion to be appropriate in
the  circumstances.  The Advisor  will  disclose  to the  Company  any  material
interest of the  Advisor,  or its  affiliates  or designees  providing  services
hereunder, in matters that are the subject of the advisory services contemplated
hereby,  other than the Advisor's  interest as a shareholder  of the Company and
designees as directors of the Company.

                  (b) The Advisor and the individuals  acting on its behalf that
are actually  providing  the services  contemplated  hereby will be  independent
contractors,  rather than employees or agents, and will have only such authority
as  is  incident  to  the  discharge  of  the  duties  herein   contemplated  or
specifically  authorized  from  time to time by the  Board of  Directors  of the
Company (the "Board").

                  2.  Consideration.  In consideration for the services provided
by the Advisor  under this  Agreement,  the Company will pay to the Advisor such
customary  advisory fees (the "Fees") based upon the type and amount of services
provided  by the Advisor and as are agreed upon by the Advisor and a majority of
those members of the Board who are  "independent  directors"  having no material
affiliation or relationships with the Purchaser, the Advisor or the Company.

                  3.  Reimbursements.  In addition to the Fees, the Company will
pay directly or reimburse the Advisor for its Out-of-Pocket  Expenses.  Promptly
following  the  Company's  request  therefor,  the Advisor will provide  written
substantiation in reasonable detail relating to any Out-of-Pocket Expenses to be
paid or reimbursed by the Company  pursuant to this Agreement.  For the purposes
of this Agreement,  the term  "Out-of-Pocket  Expenses" means the  out-of-pocket
costs and expenses that are actually and  reasonably  incurred by the Advisor or
its  affiliates  in  connection  with  the  services  rendered  hereunder.   All
reimbursements for Out-of-Pocket  Expenses will be made promptly upon or as soon
as  practicable  after  presentation  by the Advisor to the Company of a written
statement therefor.

                  4. Confidentiality.  (a) All non-public information concerning
the Company which is given to the Advisor or its officers, directors,  employees
and/or agents (its "Representatives") by the Company or its Representatives from
time to time  will  be used  solely  in the  course  of the  performance  of the
Advisor's services hereunder or, in the case of any of such persons who are also
officers and/or directors of the Company, in their capacities as officers and/or

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directors  of the  Company.  Except  as  contemplated  by this  Agreement  or as
otherwise  required by  applicable  law or judicial or regulatory  process,  the
Advisor will not disclose any  non-public  information  to a third party without
the Company's consent.

                  (b)  The  Advisor   acknowledges  that  the  Advisor  and  its
Representatives  are subject to the  Company's  insider  trading  policy and the
Advisor has so advised its Representatives.

                 5.  Indemnification.  (a) The Company will  indemnify  and hold
harmless  the Advisor,  its  affiliates,  and their  respective  partners  (both
general  and  limited),   members  (both  managing  and  otherwise),   officers,
directors,  employees,  agents and  representatives  (each such person  being an
"Indemnified  Party") from and against any and all losses,  claims,  damages and
liabilities,  whether joint or several (the "Indemnifiable Losses"), related to,
arising out of or in connection with the services contemplated by this Agreement
or the engagement of the Advisor pursuant to, and the performance by the Advisor
of the  services  contemplated  by,  this  Agreement,  whether or not pending or
threatened,  whether or not an  Indemnified  Party is a party and whether or not
such action,  claim, suit,  investigation or proceeding (a "Claim") is initiated
or brought by the Company directly, derivatively or otherwise, including without
limitation  any action,  suit,  proceeding or  investigation  arising out of any
action or failure  to take  action by the  Company  or any of its  subsidiaries,
whether  or not based on a theory of primary or  secondary  liability,  and will
reimburse any Indemnified Party for all reasonable costs and expenses (including
reasonable attorneys' fees and expenses) as they are incurred in connection with
investigating, preparing, pursuing, defending or assisting in the defense of any
Claim for which the Indemnified Party would be entitled to indemnification under
the terms of this  sentence,  or any  action or  proceeding  arising  therefrom,
whether or not such Indemnified Party is a party thereto, provided that, subject
to the following sentence,  the Company, upon execution of a written undertaking
reasonably  satisfactory  to the  Advisor  confirming  the  Company's  indemnity
obligations hereunder (without any reservation of rights other then as permitted
elsewhere herein) and expressly  releasing all Indemnified  Parties from any and
all  liability  related to the  matter in  question  subject to the  limitations
contained herein (such undertaking, an "Indemnity Undertaking") will be entitled
to assume the defense thereof at its own expense,  with counsel  satisfactory to
such Indemnified Party in its reasonable judgment. Any Indemnified Party may, at
its own expense,  retain separate counsel to participate in such defense, and in

<PAGE>

any Claim in which both the Company and/or one or more of its  subsidiaries,  on
the one hand, and an Indemnified  Party, on the other hand, is, or is reasonably
likely to become, a party,  such Indemnified Party will have the right to employ
separate counsel at the expense of the Company and to control its own defense of
such Claim if, in the reasonable opinion of counsel to such Indemnified Party, a
conflict or potential conflict exists between the Company,  on the one hand, and
such  Indemnified  Party,  on the other  hand,  that  would  make such  separate
representation  advisable. The Indemnified Party shall give prompt notice to the
Company of any actual or asserted event or occurrence  that could  reasonably be
expected to give rise to a Claim. The failure by an Indemnified  Party to notify
the Company of a Claim will not relieve the Company from any liability hereunder
unless, and only to the extent that, the Company did not learn of such Claim and
such failure  shall  materially  prejudice  the ability of the Company to defend
such  Claim or  otherwise  perfect  rights to any  insurance  coverage  relating
thereto.  The  Company  will not,  without  the  prior  written  consent  of the
applicable Indemnified Party, settle,  compromise or consent to the entry of any
judgment in any pending or threatened Claim relating to the matters contemplated
hereby (if any Indemnified Party is a party thereto or has been threatened to be
made a party thereto) unless such settlement,  compromise or consent includes an
unconditional  release of the  applicable  Indemnified  Party from all liability
arising  or that may arise out of such  Claim.  Provided  the  Company is not in
breach of its indemnification  obligations  hereunder,  no Indemnified Party may
settle or compromise any Claim subject to indemnification  hereunder without the
consent of the Company  provided that prior thereto such  Indemnified  Party has
been furnished with an Indemnity Undertaking.

                  (b) If any  indemnification  sought by any  Indemnified  Party
pursuant to this Section is  unavailable  for any reason or is  insufficient  to
hold the Indemnified Party harmless against any Indemnifiable Losses referred to
herein,  then the Company will contribute to the Indemnifiable  Losses for which
such  indemnification  is held unavailable or insufficient in such proportion as
is appropriate to reflect the relative  benefits  received (or anticipated to be
received) by the Company,  on the one hand, and the Advisor,  on the other hand,
in connection with the transactions which gave rise to such Indemnifiable Losses
or,  if such  allocation  is not  permitted  by  applicable  law,  not only such
relative benefits but also the relative faults of the Company,  on the one hand,
and  the  Advisor,   on  the  other  hand,  as  well  as  any  other   equitable
considerations,  subject  to the  limitation  that in any  event  the  aggregate

<PAGE>

contribution by the Indemnified Parties to all Indemnifiable Losses with respect
to which  contribution  is  available  hereunder  will not  exceed the Fees paid
through the date on which (or, if more than one date, the last date on which the
conduct occurred that gave rise to the Indemnifiable Loss).

                  (c)  Notwithstanding  any other provision hereof,  none of the
Advisor nor any employee,  officer,  director or other related  person or entity
will  have  any  liability  or  obligation  by  reason  of  this  Agreement  for
performance or nonperformance of services  contemplated hereby except and solely
to  the  extent  that  it is  judicially  determined  by a  court  of  competent
jurisdiction that such person intentionally  breached or caused to be breached a
material  provision  of this  Agreement.  The parties  hereto  hereby  expressly
disclaim any liability or obligation of the Advisor and its affiliates or any of
their  respective  employees,  officers,  directors and other related persons or
entities for actual or alleged  negligence of any  character in connection  with
the services contemplated by this Agreement.

                  (d) The  provisions  of this  Section 5 will be in addition to
and in no manner limit or  otherwise  affect any other right that the Advisor or
any other  Indemnified  Party may have,  whether  by  contract,  or arising as a
matter of law or the constituent documents of any other entity.

                  6. Term.  This  Agreement will terminate by (i) mutual consent
of the  parties or (ii) on or after July 1, 2001,  by either the  Company or the
Advisor with or without cause on 60 calendar days prior notice to the other. The
termination  or  expiration  of the term of this  Agreement  will not affect the
Advisor's  rights  (i) under  Sections 3 or 5 hereof  (which  will  survive  any
termination or expiration of this Agreement) and (ii) under Section 2 to receive
the amount of Fees pro rated based upon the portion of services  performed prior
to such termination.

                  7. Miscellaneous.  (a) No amendment or waiver of any provision
of this  Agreement,  or consent to any departure by either party hereto from any
such  provision,  shall be  effective  unless the same  shall be in writing  and
signed by each of the parties hereto. Any amendment,  waiver or consent shall be
effective only in the specific  instance and for the specific  purpose for which
given. The waiver by any party of any breach of this Agreement shall not operate
as or be construed to be a waiver by such party of any subsequent breach.
<PAGE>

                  (b) Any notices or other communications  required or permitted
hereunder  shall  be  sufficiently  given  if  delivered  personally  or sent by
facsimile,  Federal Express or other nationally  recognized  overnight  courier,
addressed  as  follows or to such other  address of which the  parties  may have
given notice:

If to the Advisor:                  The Hampstead Group, L.L.C.
                                    4200 Texas Commerce Tower West
                                    2000 Ross Avenue
                                    Dallas, Texas 75201
                                    Attention:  William T. Cavanaugh, Jr.
                                    Facsimile:  (214) 220-4949

If to the Company:                  Omega Healthcare Investors, Inc.
                                    900 Victors Way
                                    Suite 350
                                    Ann Arbor, Michigan 48108
                                    Attention:  Susan Allene Kovach
                                    Facsimile:  (734) 887-0322

Unless otherwise specified herein, such notices or other communications shall be
deemed  received (i) on the date delivered,  if delivered  personally or sent by
facsimile,  and (ii) one  business  day after  being sent by Federal  Express or
other overnight courier.

                  (c) This  Agreement  shall be governed by, and  construed  and
interpreted  in  accordance  with,  the  laws of the  State  of  Delaware.  This
Agreement shall inure to the benefit of, and be binding upon, the parties hereto
and their respective  successors and assigns.  The provisions of Section 5 shall
inure to the benefit of each Indemnified Party.

                  (d) This  Agreement  may be executed by one or more parties to
this  Agreement  on any  number  of  separate  counterparts,  and  all  of  said
counterparts  taken  together  shall be  deemed to  constitute  one and the same
instrument.

                  (e) The  waiver by any party of any  breach of this  Agreement
shall  not  operate  as or be  construed  to be a  waiver  by such  party of any
subsequent breach.

                  (f) Any  provision of this  Agreement  which is  prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability  without  invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction  shall be not invalidate or render  unenforceable such provision in
any other jurisdiction.
<PAGE>

                  (g) For purposes of this  Agreement,  (i)  "affiliate"  of any
person means  another  person that directly or  indirectly,  through one or more
intermediaries,  controls, is controlled by or is under common control with such
first person and (ii) "person"  means an individual,  corporation,  partnership,
limited liability company,  joint venture,  association,  trust,  unincorporated
organization or other entity.

                  (h) When a reference  is made in this  Agreement to a Section,
such reference is to a Section of this  Agreement  unless  otherwise  indicated.
Whenever  the  words  "include",  "includes"  or  "including"  are  used in this
Agreement, they will be deemed to be followed by the words "without limitation".
The words  "hereof",  "herein" and  "hereunder" and words of similar import when
used in this  Agreement  will refer to this  Agreement as a whole and not to any
particular provision of this Agreement. All terms defined in this Agreement will
have the defined meanings when used in any certificate or other document made or
delivered  pursuant hereto unless  otherwise  defined  therein.  The definitions
contained in this Agreement are applicable to the singular as well as the plural
forms of such terms and to the  masculine  as well as to the feminine and neuter
genders  of  such  term.  References  to a  person  are  also  to its  permitted
successors and assigns.

                  (i) This Agreement  (including  the documents and  instruments
referred to herein) (i)  constitutes  the entire  agreement,  and supersedes all
prior  agreements and  understandings,  both written and oral, among the parties
with  respect to the subject  matter of this  Agreement  and (ii) except for the
provisions  of Section 5, are not  intended to confer upon any person other than
the parties any rights or remedies.

                  (j) Neither this Agreement nor any of the rights, interests or
obligations  under  this  Agreement  may be  assigned,  in whole or in part,  by
operation of law or otherwise by either of the parties  hereto without the prior
written  consent of the other  party;  provided  however,  that the  Advisor may
assign its rights  and  obligations  under this  Agreement  to an  Affiliate  of
Advisor  without  the consent of the Company  provided  that no such  assignment
shall relieve Advisor of its obligations under this Agreement. Any assignment in
violation  of the  preceding  sentence  will be void.  Subject to the  preceding
sentence,  this Agreement will be binding upon,  inure to the benefit of, and be
enforceable by, the parties and their respective successors and assigns.
<PAGE>

                  (k) The parties agree that irreparable  damage would occur and
that the parties would not have any adequate remedy at law in the event that any
of the provisions of this Agreement were not performed in accordance  with their
specific terms or were  otherwise  breached.  It is accordingly  agreed that the
parties will be entitled to an injunction or injunctions to prevent  breaches of
this  Agreement  and to enforce  specifically  the terms and  provisions of this
Agreement in any federal  court  located in the State of Delaware or in Delaware
state  court,  this  being in  addition  to any other  remedy to which  they are
entitled  at law or in  equity.  In  addition,  each of the  parties  hereto (i)
consents to submit  itself to the  personal  jurisdiction  of any federal  court
located in the State of Delaware  and or any  Delaware  state court in the event
any dispute arises out of this Agreement or any of the transactions contemplated
by this  Agreement,  (ii) agrees that it will not attempt to deny or defeat such
personal  jurisdiction by motion or other request for leave from any such court,
and (iii) agrees that it will not bring any action relating to this Agreement or
any of the transactions contemplated by this Agreement in any court other than a
federal court sitting in the State of Delaware or a Delaware state court.



                            [Signature page follows]



<PAGE>




                  IN WITNESS WHEREOF,  the parties have caused this Agreement to
be  executed as of the date first  written  above by their  respective  officers
thereto duly authorized.


                                               OMEGA HEALTHCARE INVESTORS, INC.


                                               By: /s/ Susan A. Kovach
                                                   -----------------------
                                                    Susan A. Kovach
                                                    Vice President


                                               THE HAMPSTEAD GROUP, L.L.C.


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