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                                                                    Exhibit 10.2

                                                                  EXECUTION COPY

                                NINTH AMENDMENT
                              TO CREDIT AGREEMENT
                                     AMONG
                           BEVERLY ENTERPRISES, INC.,
               BEVERLY HEALTH AND REHABILITATION SERVICES, INC.,
               (FORMERLY KNOWN AS BEVERLY CALIFORNIA CORPORATION)
                    THE SUBSIDIARY GUARANTORS LISTED HEREIN,
                           THE LENDERS LISTED HEREIN,
                                      AND
                          THE NIPPON CREDIT BANK, LTD.
                          LOS ANGELES AGENCY, AS AGENT

                           DATED AS OF APRIL 22, 1996


        THIS NINTH AMENDMENT dated as of April 22, 1996 (this "AMENDMENT"), is
entered into by and among BEVERLY ENTERPRISES, INC., a Delaware corporation
("BEI"), BEVERLY HEALTH AND REHABILITATION SERVICES, INC. (formerly known as
Beverly California Corporation), a California corporation ("BORROWER"), the
SUBSIDIARY GUARANTORS listed on the signature pages hereof (together with BEI,
the "GUARANTORS"), the LENDERS listed on the signature pages hereof (such
lenders, together with each Person that may or has become a party to the Credit
Agreement (as hereinafter defined) pursuant to subsection 10.8 thereof, are
referred to herein individually as a "LENDER" and collectively as the
"LENDERS"), and THE NIPPON CREDIT BANK, LTD., Los Angeles Agency ("NIPPON"), as
agent for the Lenders (in such capacity, the "AGENT"). This Amendment amends
the Credit Agreement dated as of March 2, 1993 by and among BEI, Borrower,
Agent and Lenders, as amended by that certain First Amendment to Credit
Agreement dated as of May 6, 1994, as further amended by that certain Second
Amendment to Credit Agreement dated as of May 19, 1994, as further amended by
that certain Third Amendment to Credit Agreement dated as of November 1, 1994,
as further amended by that certain Fourth Amendment to Credit Agreement dated
as of November 9, 1994, as further amended by that certain Fifth Amendment to
Credit Agreement dated as of December 30, 1994, as further amended by that
certain Sixth Amendment to Credit Agreement dated as of July 25, 1995, as
further amended by that certain Seventh Amendment to Credit Agreement dated as
of September 29, 1995, and as further amended by that certain Eighth Amendment
to Credit Agreement dated as of February 14, 1996 (as so amended, the "CREDIT
AGREEMENT"), as set forth herein.

                                    RECITALS

        WHEREAS, Borrower desires to amend the Credit Agreement in certain
respects;
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        WHEREAS, Lenders and Agent have agreed to approve such amendments;

        WHEREAS, Guarantors desire to reaffirm the effectiveness respectively
of the subsidiary Guaranty Agreement and the BEI Guaranty Agreement;

                                   AGREEMENT

        NOW, THEREFORE, in consideration of the terms and conditions herein
contained, BEI, Borrower, Guarantors, Agent and Lenders agree as follows:

   1.   Definitions, Interpretation. All capitalized terms defined above and
elsewhere in this Amendment shall be used herein as so defined. Unless
otherwise defined herein, all other capitalized terms used herein shall have
the respective meanings given to those terms in the Credit Agreement, as
amended by this Amendment. The rules of construction set forth in Section I of
the Credit Agreement shall, to the extent not inconsistent with the terms of
this Amendment, apply to this Amendment and are hereby incorporated by
reference.

   2.   Amendment to Credit Agreement. Subject to conditions set forth in
paragraph 4 hereof, the Credit Agreement is hereby amended as follows:

        (a) The definition of "Adjusted Eurodollar Rate" appearing Section 1.1
   is hereby amended to read in its entirety as follows:

            "Adjusted Eurodollar Rate" means for each Interest Period (i) the
        arithmetic average (rounded upward, if necessary, to the next higher
        1/16 of 1%), as determined by the Agent, of the respective rates per
        annum quoted by Barclays Bank PLC, Bankers Trust Company, The Bank of
        Tokyo and National Westminster Bank PLC (or any successors of any of
        the foregoing) on the "LIBO" page of the Reuters Monitor Money Rate
        Service (or any successor publication) on the second Business Day prior
        to the commencement of such Interest Period (or, if such rates do not
        appear, the rate at which Dollar deposits are offered to NCB in the
        London interbank eurodollar currency market on the second Business Day
        prior to the commencement of such Interest Period) at or about 11:00
        A.M. (London time) for delivery on the first day of such Interest
        Period, divided by (ii) a number equal to 1.00 minus the maximum rate
        or rates (expressed as a decimal fraction) of reserve requirements in
        effect on the day which is two Business Days prior to the beginning of
        such Interest Period (including, without limitation, basic,
        supplemental, marginal and emergency reserves under any





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        regulations of the Board of Governors of the Federal Reserve System or
        other governmental authority having jurisdiction with respect thereto,
        as now and from time to time in effect) for Eurocurrency funding
        (currently referred to as "Eurocurrency liabilities" in Regulation D of
        such Board) which are required to be maintained by a member bank of
        such System (such rate to be rounded upward, if necessary, to the next
        higher 1/16 of 1%).

   3.   Representations and Warranties. In order to induce the Agent and the
Lenders to enter into this Amendment, each of BEI and Borrower represents and
warrants to the Agent and the Lenders that:

        (a) The representations and warranties of each Loan Party contained in
   the Credit Agreement are true, correct and complete in all material respects
   on and as of the date hereof to the same extent as though made on and as of
   the date hereof except to the extent that such representations and
   warranties specifically relate to an earlier date, in which case they are
   true, correct and complete in all material respects as of such earlier date;

        (b) No event has occurred and is continuing or would result from the
   execution of this Amendment that constitutes an Event of Default or
   Potential Event of Default;

        (c) Each Loan Party has performed in all material respects all
   agreements and satisfied all conditions that the Credit Agreement and this
   Amendment provide shall be performed by it on or before the date hereof;

        (d) The execution, delivery and performance of this Amendment, and the
   Credit Agreement as amended by this Amendment, by each Loan Party which is a
   party thereto are within the corporate power and authority of each such Loan
   Party and, as of the Ninth Amendment Effective Date (as hereinafter
   defined), will be duly authorized by all necessary corporate action on the
   part of each Loan Party, and this Amendment as of the Ninth Amendment
   Effective Date, are duly executed and delivered by each of such Loan Parties
   which is a party thereto and will constitute a valid and binding agreement
   of each of such Loan Parties, enforceable against such Loan Parties in
   accordance with their terms, except as may be limited by bankruptcy,
   insolvency, reorganization, moratorium or similar laws or equitable
   principles relating to or limiting creditors' rights generally or by
   equitable principles relating to enforceability. The Credit Agreement
   constitutes and, as of the Ninth Amendment Effective Date, the Credit
   Agreement, as amended by this Amendment, will constitute, a valid and
   binding agreement of each applicable Loan Party, enforceable against each
   applicable Loan Party in accordance with their respective terms, except as
   may be limited by bankruptcy,





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   insolvency, reorganization, moratorium or similar laws or equitable
   principles, relating to or limiting creditors' rights generally or by
   equitable principles relating to enforceability.

        (e) The execution and delivery by each applicable Loan Party of this
   Amendment, and the performance by each such Loan Party of the Credit
   Agreement as amended by this Amendment, do not and will not (i) violate any
   provision of any law or any governmental rule or regulation applicable to
   any Loan Party, the Certificate or Articles of Incorporation or Bylaws of
   any Loan Party or any order, judgment or decree of any court or other agency
   of government binding on any Loan Party, (ii) conflict with, result in a
   breach of or constitute (with due notice or lapse of time or both) a default
   under any instrument that is material, individually or in the aggregate, and
   that is binding on such Loan Party, (iii) result in or require the creation
   or imposition of any Lien upon any of the properties or assets of any Loan
   Party, or (iv) require any approval or consent of any Person under any
   instrument that is material, individually or in the aggregate, and that is
   binding on such Loan Party.

        (f) The execution and delivery by each applicable Loan Party of this
   Amendment, and the performance by each such Loan Party of the Credit
   Agreement as amended by this Amendment, do not and will not require any
   registration with, consent or approval of, or notice to, or other action to,
   with or by, any federal, state or other governmental authority or regulatory
   body.

   4.   Conditions to Effectiveness. Section 2 of this Amendment shall become
effective only upon the satisfaction of all of the following conditions
precedent (the date of satisfaction of such conditions being referred to herein
as the "Ninth Amendment Effective Date"):

        (a) On or before the Ninth Amendment Effective Date, Borrower shall
   deliver to the Lenders (or to the Agent for the Lenders with sufficient
   originally executed copies, as appropriate, for each Lender and its counsel)
   the following, each, unless otherwise noted, dated the Ninth Amendment
   Effective Date, duly executed and delivered by the parties thereto:

            (i) Signature and incumbency certificates of each of BEI, Borrower
        and each Subsidiary Guarantor of its respective officers executing this
        Amendment certified by such party's respective secretary or assistant
        secretary; and

            (ii)  Executed counterparts of this Amendment.





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        (b) On or before the Ninth Amendment Effective Date, all corporate and
   other proceedings taken or to be taken in connection with the transactions
   contemplated hereby and all documents incidental thereto not previously
   found acceptable by the Agent, acting on behalf of the Lenders, and its
   counsel shall be satisfactory in form and substance to the Agent and such
   counsel, and the Agent and such counsel shall have received all such
   counterpart originals or certified copies of such documents as the Agent may
   reasonably request.

        (c) On or before the Ninth Amendment Effective Date, the Borrower shall
   have caused payment to the Agent of all amounts regarding the costs and
   expenses reasonably incurred by Agent in connection with this Amendment.

   5.  Acknowledgment and Agreement of Guarantors.  Each Guarantor acknowledges
that it has reviewed the terms and provisions of the Credit Agreement and this
Amendment and consents to the amendment of the Credit Agreement effected
pursuant to this Amendment. Each Guarantor hereby confirms that the Guaranty
Agreement and the Collateral Documents to which it is a party or otherwise
bound and all Collateral encumbered thereby will continue to guaranty or
secure, as the case may be, to the fullest extent possible the payment and
performance of all Obligations, Guarantied Obligations (as defined in the
applicable Guaranty Agreements) and Secured Obligations (as defined in the
Collateral Documents), as the case may be, including, without limitation, the
payment and performance of all obligations of Borrower now or hereafter
existing under or in respect of the Credit Agreement as amended by this
Amendment and the Notes defined therein.

        Each Guarantor acknowledges and agrees that any of the Guaranty
Agreements and the Collateral Documents to which it is a party or otherwise
bound shall continue in full force and effect and that all of its obligations
thereunder shall be valid and enforceable and shall not be impaired or limited
by the execution or effectiveness of this Amendment.  Each Guarantor represents
and warrants that all representations and warranties contained in the Credit
Agreement as amended by this Amendment and the Guaranty Agreements and the
Collateral Documents to which it is a party or otherwise bound are true,
correct and complete in all material respects on and as of the Ninth Amendment
Effective Date to the same extent as though made on and as of that date except
to the extent that such representations and warranties specifically relate to
an earlier date, in which case they are true, correct and complete in all
material respects as of such earlier date.

        Each Guarantor acknowledges and agrees that in addition to all the
other waivers agreed to and made by Guarantor as set forth in the Guaranty
Agreement and the Collateral Documents to which it is a party or otherwise
bound, and pursuant to the





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provisions of California Civil Code Section 2856, "Guarantor waives all rights
and defenses arising out of an election of remedies by the creditor, even
though that election of remedies, such as a nonjudicial foreclosure with
respect to security for a guaranteed obligation, has destroyed the Guarantor's
rights of subrogation and reimbursement against the principal by the operation
of Section 580d of the Code of Civil Procedure or otherwise."

        Each Guarantor acknowledges and agrees that (i) notwithstanding the
conditions to effectiveness set forth in this Amendment, such Guarantor is not
required by the terms of the Credit Agreement or any other Loan Document to
consent to the amendments to the Credit Agreement effected pursuant to this
Amendment or any other Loan Document and (ii) that neither the terms of the
Credit Agreement, any other Loan Document nor this Amendment shall be deemed to
require the consent of any Guarantor to any future amendments to the Credit
Agreement.

   6.  Effectiveness; Counterparts.  This Amendment may be executed in any
number of counterparts, and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. This Amendment (other than the provisions of Section 2) shall
become effective upon the execution of a counterpart hereof by all Lenders and
each of the Loan Parties and receipt of written or telephonic notification of
such execution and authorization of delivery thereof.

   7.  Fees and Expenses.  The Borrower acknowledges that all costs, fees and
expenses as described in subsection 10.4 of the Credit Agreement incurred by
the Agent and its counsel with respect to this Amendment and the documents and
transactions contemplated hereby shall be for the account of the Borrower.

   8.  Effect of Amendment.  It is hereby agreed that, except as specifically
provided herein, this Amendment does not in any way affect or impair the terms
and conditions of the Credit Agreement, and all terms and conditions of the
Credit Agreement are to remain in full force and effect unless otherwise
specifically amended or changed pursuant to the terms and conditions of this
Amendment.

   9.  Applicable Law.  This Amendment and the rights and obligations of the
parties hereto and all other aspects hereof shall be deemed to be made under,
shall be governed by, and shall be construed and enforced in accordance with,
the laws of the State of New York without regard to principles of conflicts of
laws.





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