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                                                                      EXHIBIT 3


                              [Company Letterhead]


                                November 2, 1994


To Our Stockholders:

                 On September 29, 1994, the Board of Directors of Beverly
Enterprises, Inc. ("Beverly") adopted a Stockholder Rights Plan that is 
intended to protect your interests in the event you and Beverly are confronted
with coercive takeover tactics.

                 The Plan provides for a dividend distribution of rights (the
"Rights") to purchase shares of Beverly Common Stock.  Under certain 
circumstances, the Rights could become exercisable to purchase Beverly Common 
Stock, or securities of an acquiring entity, at one-half market value.  The 
Rights may be exercised only if certain events occur.  You are now the owner 
of one Right for each share of Beverly Common Stock you own.  The Plan has 
been adopted in order to strengthen the ability of the Board to protect your 
interests.

                 We are attaching a summary description that outlines the
principal features of the Plan, and we urge you to read the summary carefully.
This letter reviews our reasons for issuing the Rights.

                 NO ACTION BY STOCKHOLDERS IS REQUIRED OR PERMITTED AT THIS
TIME, AND NO MONEY SHOULD BE SENT TO BEVERLY ENTERPRISES.  THE RIGHTS WILL
AUTOMATICALLY ATTACH TO THE COMMON SHARES YOU HOLD AND WILL TRADE WITH THEM.
SEPARATE RIGHTS CERTIFICATES WILL BE SENT TO STOCKHOLDERS ONLY IF A PERSON OR
GROUP ACQUIRES 15% OR MORE OF BEVERLY'S OUTSTANDING COMMON STOCK OR MAKES A
TENDER OFFER FOR 15% OR MORE OF THE COMMON STOCK.  BEVERLY COMMON STOCK
CERTIFICATES ISSUED AFTER NOVEMBER 2, 1994 WILL CONTAIN A REFERENCE TO THE
RIGHTS PLAN, BUT THERE IS NO NEED TO SEND IN YOUR CERTIFICATES TO HAVE THIS
REFERENCE ADDED.

                 The Rights are not being distributed in response to any
specific effort to acquire control of the Company.  The Rights are designed to
protect stockholders in the event of an unsolicited attempt to acquire the
Company, including through an accumulation of Common Stock in the open market,
a partial, two-tier or inadequate tender offer that does not treat all
stockholders equally and other abusive takeover tactics which the Board of
Directors believes are not in the best interests of stockholders.  These
tactics unfairly pressure stockholders, squeeze them out of their investment
without giving them any real choice and deprive them of the full value of their
Common Stock.  We consider these Rights to be a valuable means of protecting
both your right to retain your equity investment in the Company and the full
value of that investment, while not foreclosing a fair acquisition bid for the
Company.

                 The Rights are not intended to prevent a takeover of Beverly
and will not do so.  They are designed to deal with the possibility of
unilateral actions by hostile acquirors that could deprive the Board of
Directors and stockholders of Beverly of their ability to determine the
Company's destiny and to obtain the highest price for their Common Stock.
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November 2, 1994
Page 2


                 Adoption of the Plan should not by itself affect any
prospective acquiror who is willing to make an all-cash offer at a full and
fair price or who is willing to negotiate with the Company's Board of
Directors.  The Plan certainly will not interfere with a merger or other
business combination transaction approved by the Board of Directors.

                 The issuance of the Rights has no dilutive effect, will not
affect reported earnings per share and is not taxable to the Company or to you.
Stockholders may, under certain circumstances, recognize taxable income if the
Rights become exercisable.

                 Our overriding objective is to continue building value for
Beverly's stockholders, and we feel that the Plan will assist in that effort.


                                       Sincerely,



                                       David R. Banks
                                       Chairman of the Board, President
                                       and Chief Executive Officer





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         As described in the Rights Agreement, Rights which are held by
       or have been held by Acquiring Persons or Associates or Affiliates
    thereof (as defined in the Rights Agreement) shall become null and void.

                         SUMMARY OF RIGHTS TO PURCHASE
                                 COMMON SHARES

                 On September 29, 1994 the Board of Directors of Beverly
Enterprises, Inc. (the "Company") declared a dividend of one Right for each
share of common stock, $.10 par value (the "Common Shares"), of the Company
outstanding at the close of business on November 2, 1994 (the "Record Date").
As long as the Rights are attached to the Common Shares, the Company will issue
one Right with each new Common Share so that all such shares will have attached
Rights.  Each Right entitles the registered holder to purchase from the Company
one Common Share at a price of $70 per share, subject to adjustment (the
"Purchase Price").  The description and terms of the Rights are set forth in a
Rights Agreement, dated as of September 29, 1994, as the same may be amended
from time to time (the "Rights Agreement"), between the Company and The Bank of
New York, as Rights Agent (the "Rights Agent").

                 Until the earlier to occur of (i) ten (10) days following a
public announcement that a person or group of affiliated or associated persons
(an "Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of 15% or more of the Common Shares or (ii) ten (10) days
following the commencement or announcement of an intention to make a tender
offer or exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 15% or more of the Common Shares
(the earlier of (i) and (ii) being called the "Distribution Date," whether or
not either such date occurs prior to the Record Date), the Rights will be
evidenced, with respect to any of the Common Share certificates outstanding as
of the Record Date, by such Common Share certificate together with a copy of
this Summary of Rights.

                 The Rights Agreement provides that the Board of Directors,
with the concurrence of a majority of the Continuing Directors (as defined
below), may postpone the Distribution Date and that, until the Distribution
Date, the Rights will be transferred with and only with the Common Shares.
Until the Distribution Date (or earlier redemption or expiration of the
Rights), new Common Share certificates issued after the close of business on
the Record Date upon transfer or new issuance of the Common Shares will contain
a notation incorporating the Rights Agreement by reference.  Until the
Distribution Date (or earlier redemption, exchange, termination or expiration
of the Rights), the surrender for transfer of any certificates for Common
Shares, with or without a copy of this Summary of Rights, will also constitute
the transfer of the Rights associated with the Common Shares represented by
such certificate.  As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Shares as of the close of business on
the Distribution Date and such separate Right Certificates alone will evidence
the Rights.

                 The Rights are not exercisable until the Distribution Date.
The Rights will expire on September 28, 2004, subject to the Company's right to
extend such date (the "Final Expiration Date"), unless earlier redeemed or
exchanged by the Company or terminated.

                 The Purchase Price payable, and the number of Common Shares or
other securities or property issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of the Common
Shares, (ii) upon the grant to holders of the Common Shares of certain rights
or warrants to





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subscribe for or purchase Common Shares or convertible securities at less than
the current market price of the Common Shares or (iii) upon the distribution to
holders of the Common Shares of evidences of indebtedness, securities or assets
(excluding regular periodic cash dividends at a rate not in excess of 125% of
the rate of the last regular periodic cash dividend theretofore paid or, in
case regular periodic cash dividends have not theretofore been paid, at a rate
not in excess of 50% of the average net income per share of the Company for the
four quarters ended immediately prior to the payment of such dividend, or
dividends payable in Common Shares (which dividends will be subject to the
adjustment described in clause (i) above)) or of subscription rights or
warrants (other than those referred to above).

                 In the event that a Person becomes an Acquiring Person (except
pursuant to certain cash offers for all outstanding Common Shares approved by
the Board) or if the Company were the surviving corporation in a merger with an
Acquiring Person or any affiliate or associate of an Acquiring Person and the
Common Shares were not changed or exchanged, each holder of a Right, other than
Rights that are or were acquired or beneficially owned by the 15% stockholder
(which Rights will thereafter be void), will thereafter have the right to
receive upon exercise that number of Common Shares having a market value of two
times the then current Purchase Price of the Right.  With certain exceptions,
in the event that the Company were acquired in a merger or other business
combination transaction or more than 50% of its assets or earning power were
sold, proper provision shall be made so that each holder of a Right shall
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price of the Right, that number of shares of common stock of
the acquiring company which at the time of such transaction would have a market
value of two times the then current Purchase Price of the Right.

                 At any time after a Person becomes an Acquiring Person and
prior to the acquisition by such Acquiring Person of 50% or more of the
outstanding Common Shares, the Board of Directors may cause the Company to
acquire the Rights (other than Rights owned by an Acquiring Person which have
become void), in whole or in part, in exchange for that number of Common Shares
having an aggregate value equal to the Spread (the excess of the value of the
Common Shares issuable upon exercise of a Right after a Person becomes an
Acquiring Person over the Purchase Price) per Right (subject to adjustment).

                 No adjustment in the Purchase Price will be required until
cumulative adjustments require an adjustment of at least 1% in such Purchase
Price. No fractional shares will be issued and in lieu thereof, a payment in
cash will be made based on the market price of the Common Shares on the last
trading date prior to the date of exercise.

                 The Rights may be redeemed in whole, but not in part, at a
price of $.01 per Right (the "Redemption Price") by the Board of Directors at
any time until ten (10) days following the public announcement that a Person
has become an Acquiring Person.  The Board of Directors, with the concurrence
of a majority of the Continuing Directors, may extend the period during which
the Rights are redeemable beyond the ten (10) days following the public
announcement that a Person has become an Acquiring Person.  Under certain
circumstances set forth in the Rights Agreement, the decision to redeem shall
require the concurrence of a majority of the Continuing Directors (as defined
below).  Immediately upon the action of the Board of Directors of the Company
electing to redeem the Rights, the Company shall make an announcement thereof,
and upon such election, the right to exercise the Rights will terminate and the
only right of the holders of Rights will be to receive the Redemption Price.

                 The term "Continuing Directors" means any member of the Board
of Directors of the Company who was a member of the Board prior to the time
that any Person becomes an Acquiring Person, and any person who is subsequently
elected to the Board if such person is recommended or





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approved by a majority of the Continuing Directors.  Continuing Directors do
not include an Acquiring Person, or an affiliate or associate of an Acquiring
Person, or any representative of the foregoing.

                 Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company beyond those as an existing
stockholder, including, without limitation, the right to vote or to receive
dividends.

                  Any of the provisions of the Rights Agreement may be amended
by the Board of Directors of the Company prior to the Distribution Date.  After
the Distribution Date, the Company and the Rights Agent may amend or supplement
the Rights Agreement without the approval of any holders of Right Certificates
to cure any ambiguity, to correct or supplement any provision contained therein
which may be defective or inconsistent with any other provisions therein, to
shorten or lengthen any time period under the Rights Agreement (so long as,
under certain circumstances, a majority of Continuing Directors approve such
shortening or lengthening) or so long as the interests of the holders of Right
Certificates (other than an Acquiring Person or an affiliate or associate of an
Acquiring Person) are not adversely affected thereby, to make any other
provisions in regard to matters or questions arising thereunder which the
Company and the Rights Agent may deem necessary or desirable, including but not
limited to extending the Final Expiration Date.  The Company may at any time
prior to such time as any Person becomes an Acquiring Person amend the Rights
Agreement to lower the thresholds described above to not less than the greater
of (i) any percentage greater than the largest percentage of the outstanding
Common Shares then known by the Company to be beneficially owned by any person
or group of affiliated or associated persons and (ii) 10%.

                 A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a Registration Statement on
Form 8-A.  A copy of the Rights Agreement is available free of charge from the
Company.  This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement,
which is incorporated herein by reference.





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