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                                                                   Exhibit 10.25

                    SECOND AMENDMENT TO EMPLOYMENT AGREEMENT


            THIS AMENDMENT (the "AMENDMENT") is made as of the 1st day of May,
2001 and shall hereby constitute the second amendment to the employment
agreement, dated October 27, 1997, and effective as of June 18, 1997, as amended
on March 13, 2000 (the "AGREEMENT"), and is made by and among Duane Reade Inc.,
a Delaware corporation (the "COMPANY"), and Anthony Cuti (the "EXECUTIVE").
Capitalized terms that are not otherwise defined in this Amendment shall have
the meanings assigned to them in the Agreement.

                                   WITNESSETH:

            WHEREAS, the Executive and the Company entered into the Agreement,
effective June 18, 1997 and Executive is currently employed by the Company under
the Agreement; and

            WHEREAS, pursuant to Section 34 of the Agreement (as numbered prior
to this Amendment), the Company and the Executive may amend the Agreement by an
instrument in writing, signed by the Executive and the Chairman of the Board of
Directors of the Company; and

            WHEREAS, the parties desire to enter into this Amendment, which
Amendment shall, be effective as of the date first set forth above;

            NOW THEREFORE, and in consideration of the foregoing and the mutual
agreements set forth herein, the parties, intending to be legally bound, agree
as follows:

            1. ADDITIONAL RESTRICTIVE COVENANT. in addition to the restrictive
covenants set forth in Section 20 of the Agreement, the Executive hereby agrees
that, during the Tenn of Employment, he will not solicit an invitation for
employment in the food and drug industry from any employer other than the
Company unless he first receives a written waiver of the restriction set forth
in this Section I signed by either David Jaffe, the Chairman of the Compensation
Committee of the Company's Board of Directors (the "BOARD"), or his successor,
or a majority of the members of the Board. The Executive further agrees that if
he receives an unsolicited formal offer of employment in the food and drug
industry from any employer other than the Company, he shall inform either David
Jaffe, the Chairman of the Compensation Committee of the Board, or his
successor, or the Board of his receipt of such offer.

            2. DEFINITION OF "SALE OF THE COMPANY." The definition of Sale of
the Company as set forth in Section 1 of the Agreement is hereby deleted in its
entirety and replaced by the following:

            "SALE OF THE COMPANY" shall mean the consummation of one of the
following events:

            (i) any independent Third Party Is or becomes the Beneficial Owner
      (as defined below), directly or indirectly, of securities of the Company
      representing 30% or more of the combined voting power of the Company's
      then outstanding securities. For purposes of this Agreement, the term
      "BENEFICIAL OWNER" shall have the meaning given to such terms in Rule
      13d-3 under the Exchange Act;
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            (ii) the stockholders of the Company approve a merger or
      consolidation of the Company with any other corporation (or other entity),
      other than a merger or consolidation which would result in the voting
      securities of the Company outstanding immediately prior thereto continuing
      to represent (either by remaining outstanding or by being converted into
      voting securities of the surviving entity) more than 50% of the combined
      voting power of the voting securities of the Company or such surviving
      entity outstanding immedietely after such merger or consolidation;
      PROVIDED, HOWEVER, that a merger or consolidation effected to implement a
      recapitalization of the Company (or similar transaction) in which no
      person acquires more than 25% of the combined voting power of the
      Company's then outstanding securities shall not constitute a Sale of the
      Company;

            (iii) the stockholders of the Company approve a plan of complete
      liquidation of the Company or an agreement for the sale or disposition by
      the Company of all or substantially all of the Company's assets; or

            (iv) DLJ ceases to own at least 1,200,000 shares of Common Stock. A
      Sale of the Company as defined in this subsection (iv) shall hereinafter
      be referred to as a "DLJ Sale".

            3. DEFINITION OF GOOD REASON. The definition of Good Reason, as set
forth in Section 1 of the Employment Agreement, is hereby deleted in its
entirety and replaced by the following:

            "GOOD REASON" shall mean the occurrence of the following:

            (i) a reduction, without the Executive's written consent, in the
      Executive's then current Base Salary, unless such reduction is generally
      applicable to all executives of the Company;

            (ii) removal, without his consent, of the Executive from the
      position of President. Chief Executive Officer or Chairman of the Company
      or assignment, without his consent, to the Executive of any duties
      materially and adversely inconsistent with THE EXECUTIVE'S position as
      President, Chief Executive Officer or Chairman of the Company or any other
      action which results in a material and adverse change in such status,
      offices, titles or responsibilities;

            (iii) the creation of any position within the Company equal to or
      superior to that of the Executive or which does not report to the
      Executive;

            (iv) the failure of the Executive to be reelected as Chairman of the
      Board;

            (v) the relocation of the offices at which the Executive is
      principally employed to a location which requires a commute which is more
      than five miles longer than the commute from the Executive's current home
      in Saddle River, New Jersey to 440 Ninth Avenue, New York, New York, which
      relocation is not approved by the Executive;

            (vi) any material breach by the Company or DLJ of the Employment
      Related Agreements;

            (vii) any voluntary resignation by the Executive for any reason or
      for no stated reason (unless the Company shall then have a basis to
      terminate the Executive for Cause) during the 30-day period beginning six
      months following a Sale of the Company, other than a DLJ Sale; or

            (viii) any voluntary resignation by the Executive FOR any reason or
      FOR no stated reason (unless the Company shall then have a basis to
      terminate the Executive FOR Cause) at any time beginning either (A)
      eighteen months following a DLJ Sale that occurs on or before December 31,
      2001, or (B) twelve months following a DLJ Sale that occurs after December
      31, 2001, PROVIDED, HOWEVER, that at the written request of the Board,
      which request shall be provided to the Executive at least six months prior
      to the end of the


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      applicable eighteen or twelve month period, (A) the Executive shall work
      with his successor to expedite a successful transition and (B) continue to
      serve as Chairman of the Board until the earlier of the end of the
      Continuation period and the date upon which the Board elects to remove him
      from such position.

            4. SETTLEMENT OF DLJ NOTE/FORGIVENESS OF COMPANY NOTE. (a) PRIOR TO
DECEMBER 31, 2001. In the event that on or before December 31, 2001, either (i)
Executive's employment is terminated by the Company without Cause, due to the
Executive's death or Disability or by the Executive with Good Reason or (ii) a
Sale of the Company occurs (either (i) or (ii), a "FORGIVENESS EVENT"), the
Company will:

            (A) pay, on behalf of the Executive, or assume 50% of any interest
and principal balance owed by the Executive with respect to the DLJ Note as of
either the Termination Date or the date of the Sale of the Company, as
applicable; and

            (B) forgive 50% of any interest and principal balance owed by the
Executive with respect to the Company Note as of either the Termination Date or
the date of the Sale of the Company, as applicable.

            (b) AFTER DECEMBER 31, 2001. In the event that either (i) a
Forgiveness Event occurs at any time after December 31, 2001 or (ii) the
Executive's employment is terminated by the Company by reason of notice from the
Company of non-renewal of the Employment Term, the Company will:

            (A) pay, on behalf of the Executive, or assume 100% of any interest
and principal balance owed by the Executive with respect to the DLJ Note as of
either the Termination Date or the date of the Sale of the Company, as
applicable; and

            (B) forgive 100% of any interest and principal balance owed by the
Executive with respect to the Company Note as of either the Termination Date or
the date of the Sale of the Company, as applicable.

            5. Section 15(c) of the Agreement is hereby deleted in its entirety
and replaced by the following:

            (c) The Company will be under no obligation to set aside any funds
with respect to the benefit obligations accruing under the SERP; PROVIDED,
HOWEVER, that the Company agrees that prior to or simultaneous with the first
occurrence, if any, of any of the following:

            (i) any Sale of the Company;

            (ii) the termination of the Executive's employment BY the Company
      without Cause, BY the Executive for Good Reason, or BY reason of the
      Executive's death or Disability;

            (iii) the nonrenewal of this Agreement pursuant to notice
      of nonrenewal by the Company; or

            (iv) the Executive's 65th birthday;

at the Executive's election, one of the following shall occur:

            (A) The Company will establish an irrevocable grantor trust (the
"TRUST") pursuant to a trust


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agreement and fully fund the SERP in an amount equal to the Actuarial Present
Value as of the date of such funding (the "FUNDED AMOUNT"), based on a Term of
Employment which will be deemed to equal 20 years. The amount of interest earned
by the funded Amount will be evaluated annually on or before March 15. In the
event that the Funded Amount has not earned interest during the past year in an
amount equal to or greater than the prevailing rate for ten-year treasury bonds
on the Start Date (the "TREASURY RATE"), the Company will deposit an additional
amount into the grantor trust equal to (i) the amount of interest the Funded
Amount would have earned during the last calendar year at the Treasury Rate,
(ii) less the interest actually earned by the Funded Amount during such period.
The trust agreement WILL provide for a return to the Company of all assets that
remain in the trust after satisfaction of all obligations of the SERP; or

            (B) The Company shall implement such other alternative arrangement
that does not result in a total after-tax economic impact to the Company that is
materially greater than the alternative described in (A) above.

            6. CONTINUING EFFECT OF THE AGREEMENT. The Agreement shall continue
in full force and effect as amended herein.

            7. ATTORNEYS FEES. The Company shall pay or reimburse Executive for
all reasonable legal fees and costs incurred in the drafting, negotiation and
execution of this Amendment. 8. COUNTERPARTS. This Amendment may be executed by
the parties hereto in counterparts, each of which shall be deemed an original,
but both such counterparts shall together constitute one and the same document.

            8. COUNTERPARTS. This Amendment may be executed by the parties
hereto in counterparts, each of which shall be deemed an original, but both
such counterparts shall together constitute one and the same document.

            IN WITNESS WHEREOF, the parties have executed this Amendment as of
the date and year first above written.

                                  THE EXECUTIVE


                                  ---------------------------------------------
                                  Anthony Cuti
                                  440 Ninth Avenue
                                  New York, New York 10001


                                  DUANE READE INC.


                                  By:
                                     ------------------------------------------
                                     Name: Anthony Cuti
                                     Title: Chairman of the Board
                                     (In compliance with the employment
                                     agreement, dated October 27, 1997, and
                                     effective as of June 18, 1997)


                                  By:
                                     ------------------------------------------
                                  Name: David Jaffe
                                  Title: Chairman of the Compensation Committee
                                         of the Board of Directors


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